☕️ Muhyiddin Yassin: Unity Government is "hopeless"

MY ranked 44 out of 62 countries in the Global AI Index. Hackers prefer delivering malware via PDF. Fed Reserve: 23 largest US banks pass stress test. Why govts love private consultants.

1. MARKET SUMMARY 📈

Thanks to the AI boom, chipmaker Nvidia has gone on an insane rally this year, up 200%, pushing its market cap above USD1 tril (though it has cooled down a bit). Invest RM1 and in less than a year, it turned into RM3.

2. NUMBERS AT A GLANCE 🔢

Malaysia has been ranked at No. 44 in the Global AI Index, a ranking system that assesses the state of AI development in 62 countries, with a score of 19.6. The country lags behind Singapore, which secured a position in the top three. The US took the top spot, scoring 100 out of 100. The Global AI Index was released on June 28 by Tortoise Media, a London-based journalism platform. The ranking was determined by evaluating three key pillars: investment, innovation, and implementation. These pillars were further analysed to assess each country's progress in seven specific aspects, including talent, infrastructure, and government strategy.

Palo Alto Networks, a global cybersecurity leader, has reported a 55% increase in exploit attempts targeting vulnerabilities in the past year. The number of vulnerability exploitation attempts rose from 147,000 in 2021 to 228,000 in 2022, indicating a persistent upward trend. The report also reveals that PDFs are the preferred file type for delivering malware, being used 66% of the time in email-based malware delivery.

More than 800 tickets have been sold by Virgin Galactic for its spaceflights, offering passengers the opportunity to travel over 80km above Earth and experience weightlessness for a few minutes. Priced at USD450,000 per person, these flights provide breathtaking views from space during the ascent. Virgin Galactic’s first paying customers consist of a three-member crew from the Italian Air Force and National Research Council of Italy, accompanied by a Virgin Galactic astronaut instructor occupying the fourth seat.

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3. IN MALAYSIA 🇲🇾

State elections’ heat is slowly picking up steam

  1. Perikatan Nasional (PN) Chairman Muhyiddin Yassin swung another punch towards PM Anwar Ibrahim by stating that the PM did not have a clear plan on what he intended to do with the local economy. Muhyiddin also labelled the Unity Government as “hopeless” as he accused the Government did not produce any solid “wins” for the past seven months of administrating the country.

  2. Veteran politician Tun Dr Mahathir will not contest in the upcoming state elections. However, he will lend support to any party that aims to strengthen the position of the Malays.

  3. Kedah, Penang and Terengganu dissolved their state assemblies on Wednesday, joining Kelantan and Selangor in the pool of state governments under the administration of their respective caretaker governments. Negeri Sembilan will be the last state to dissolve its assembly, expected on July 1.

View table: Election offences by political parties during GE15

Malaysia's never-ending drug problem

  1. Kelantan Police arrested a 17-year-old student for possessing RM40,000 worth of heroin after receiving information from the public. Apart from that, the teenager also tested positive for drugs.

  2. Turning to Perak, the local police arrested a married couple in Ipoh for allegedly possessing and distributing drugs worth over RM500,000. The couple, aged 39 and 37, are believed to distribute the drugs (ranging from ecstasy to ketamine) to about 40,000 people at the local market since 2021.

  3. Further down south the peninsula, the Johor police arrested eight individuals who were believed to be a part of a drug syndicate in a series of raids conducted in the state. In those raids, the police also confiscated RM926,000 worth of drugs and revealed that the syndicate utilised social media such as TikTok and WeChat as one of its sales channels. Any interested buyer needs to only reach out to them on social media, pay online and pick up the merchandise at a pre-determined spot.

Some important PSA

  1. From July 5 onwards, Putrajaya announced that masks are no longer compulsory on public transport and in hospitals. However, medical front liners and Covid-19 patients still need to be mask-on at hospitals. Other than that, the quarantine period for Covid-19 patients will be reduced from seven to five days.

  2. Starting in 2024, Malaysians travelling to any country in the European Union (EU) or Schengen area need to obtain the ETIAS (European Travel Information and Authorisation System), which will cost EUR7 (around RM36) for individuals aged between 18 and 70. Application for ETIAS can be done online and the approval of the application could take from within minutes to a couple of days. ETIAS is not a visa requirement but a means of recording the movement of people in and out of the EU.

Sarawak in the news

  1. Sarawak State Tourism Minister Abdul Karim Rahman Hamzah told the media that the Sarawak State Government is still interested in taking over control of MASWings from Malaysia Airlines but not the airline’s liabilities. At the moment, MASWings is operating ten 64-seater turboprop ATR 72-500 aircraft, serving 24 destinations in East Malaysia. The proposed takeover of MASWings is aligned with the state’s ambition to own a regional airline. Should the acquisition of MASWings be successful, the airliner will be folded into Hornbill Skyways Sdn Bhd.

  2. PETRONAS’s renewable energy arm, Gentari, had struck partnerships with both Sarawak Energy Berhad (SEB) and SEDC Energy to develop the renewable energy market in Sarawak, including the introduction of an electric vehicle charging network in the state. As for the partnership between SEDC Energy and Gentari, it will focus on the production of green hydrogen. Last year, SEDC Energy signed an MoU with multiple parties, including Lotte Chemical, to develop a new plant in Bintulu (dubbed the H2biscus project) that is expected to produce 220,000 tonnes of green hydrogen.

Hong Leong Bank Bhd to launch new financing solutionIn a partnership with Paywatch Malaysia Sdn Bhd, Hong Leong Bank Bhd launched the HLB Salary Advance Employer Solution, the first bank in the Southeast Asia region to have an earned wage access (EWA) solution. With the solution, employees can withdraw up to 25% of their monthly earned salaries with only an RM2 service charge per withdrawal. Earned wage access (EWA) is a new financial solution that allows workers to access their earned wages before their scheduled paydays. Basically, borrowing against their future salary.

4. AROUND THE WORLD 🌎

23 largest US banks pass the stress testAll 23 banks included in the US Federal Reserve’s annual stress test weathered a severe recession scenario despite getting hit with a USD541 bil projected losses for the group and, most importantly, continue providing credit to consumers and corporations. This stress test started in the aftermath of the 2008 financial crisis. So what went on in this “severe global recession”?

  • Unemployment surged to 10%

  • 40% decline in commercial real estate values

  • 38% drop in housing prices

  • Of the projected USD541 bil losses, 78% of it came from losses on loans and the remaining from trading losses at Wall Street firms. 

Banks have been under heightened scrutiny following three midsized bank failures earlier this year. The funny thing is smaller banks in the US did not undergo this stress test, although there are more than 4,000 small banks in the US. Read: Fed Reserve press release and stress test results.

National Geographic lays off all staff writersAnother day, another sad news from the media industry. The 135-year-old magazine has laid off all its staff writers, a total of 19, and will no longer be sold at US newsstands as of next year. Future editorial work will be done by freelance writers and a few editors remaining on staff. 

Nat Geo is now owned by Disney following Disney’s USD71 bil acquisition of 21st Century Fox in 2019. In 2015, the National Geographic Society agreed to turn itself into a for-profit partnership with 21st Century Fox, which took majority control in exchange for USD725 mil. 

At its peak in the 1980s, Nat Geo had 12 mil subscribers and another few million around the world. Although it is still amongst the most widely read magazines in the US, at the end of 2022, it had fewer than 1.8 mil subscribers in the US. Nat Geo has a massive following of 280 mil on Instagram (give them a follow here), but sadly, such numbers did not translate to healthy financials, it seems. 

Putin’s shaky empire - cracks in leadership A respected senior Russian military leader, General Sergei Surovikin, is said to have advanced knowledge of the recent weekend mutiny in Russia by Wagner Group boss Yevgeny Prighozin, the New York Times reported, citing US Intelligence. US officials are still trying to determine if Surovikin helped plan the rebellion and that there are signs that other Russian generals may have supported Prighozin’s uprising. In January, Surovikin was replaced as the top commander but retained influence in running war operations and remains popular among the troops. Still not winning the fight in Ukraine after more than one year, Putin now has to face an internal war.

Bankrupt crypto exchange FTX - what’s happening?Two pieces of good news on the bankrupt crypto exchange FTX: 

FTX bankruptcy liquidator has also released its second interim report (summary here), revealing several baffling pieces of information, contradicting SBF’s ‘I am not guilty’ plea. According to the report, FTX misappropriated around USD8.7 bil of customers’ deposits. Fortunately, USD7 bil has been recovered so far. 

Shorts

  1. The Titan submersible was found and recovered on Wednesday, with presumed human remains within the wreckage, pending medical analysis. What happened to their bodies? Explained here.

  2. South Koreans are getting one or two years ‘younger’ after the government decided to change the country’s traditional age-counting system. The Korean system considers babies to be one year old on the day they were born and adds another year to people’s ages every 1 Jan.  So if a baby is born on New Year’s Eve, they become 2 years old the next day. Plus the international system, South Koreans would have three different ages. 

Weekend Read: Why governments love private consultants and their ‘billables’”In their book The Big Con, economists Mariana Mazzucato and Rosie Collington rightly point out that consultancies perform a “confidence trick” where they may not have ownership of any scarce, expert knowledge. Yet, they “create an impression of value” that in turn allows them to demand compensation that “far exceeds” the actual value of the knowledge they bring to the table.”

5. FOR YOUR EYES 📺

  1. How deep can humans dive?

  2. Talk about perfect timing — watch this video till the end, said to be “The Greatest Shot in Television History”.

  3. A fan-made movie poster is below. Context: 2 highly anticipated summer movies Barbie, featuring Margot Robbie and Ryan Gosling, and Christopher Nolan’s Oppenheimer, will be released just one day apart. Oppenheimer tells the story of the namesake physicist, often credited as the “father of the atomic bomb", discovering this mass destruction weapon, which was subsequently used in Hiroshima and Nagasaki. It’s a hot debate about which movie will outperform at the box office. And that building in the poster — is Barbie’s house. Now you know which movie fan made it.