☕️ Rempit-ing: rampant youth issue and growing 'spectator' base

1. MARKET SUMMARY 📈

2. NUMBERS AT A GLANCE 🔢

A total of 430,000 PTPTN (National Higher Education Fund Corporation) borrowers failed to repay their loans amounting to an estimated RM6 bil (average of RM13.95k per person), according to Higher Education Minister Dr Zambry Abd Kadir. The minister added these borrowers have never made any repayments to PTPTN despite many having established careers. As of Dec 2023, PTPTN had assisted a total of 3.95 mil students through the disbursement of student loans totalling RM71.32 bil. 10.8% of these borrowers had abandoned their moral values and siphoned resources from future borrowers.

Loving this Down Under outdoor smoking ban — since lawmakers banned most outdoor smoking in the 2000s to protect non-smokers from secondhand smoke, daily smoking rates in Australia are now down to 8.3% from 16% in 2000 and 24% in 1991. At beaches and playgrounds, smoking is banned altogether. A mix of policies including banning adverts for tobacco, health warnings, plain packaging and high taxes contributed to healthier Aussies, researchers believed that smoke-free environments had the biggest influence in stamping out smoking in public. Smoking bans at playgrounds and beaches aren’t entirely about secondhand smoke but more about preventing litter. That’s a very valid objective — in the recent World Clean Up Day programme at Saujana Beach, Port Dickson, a total of 17,160 cigarette butts were collected, up significantly from the 10,651 collected year.

Cyberbullying cases are on a rapid rise. A total of 6,598 cyberbullying cases have been reported to the Malaysian Communication and Multimedia Commission (MCMC) as of July this year, a significant rise compared to 326 cases in 2021. These complaints usually involve youths and include sexual harassment.

3. IN MALAYSIA 🇲🇾

Rempit-ing growing rampant in Malaysia
After receiving public complaints regarding traffic violations and noise disturbances, a recent operation, Op Samseng, involving Perak State Police and the National Anti-Drug Agency targeting illegal street racing in Ipoh resulted in 136 detentions, with 69 of those being students- some of the detainees were as young as 12. Remember when 12-year-olds were just watching cartoons at home? What’s even more disturbing is Formula R has a growing audience base as spectators brought along their families, including children.

While most detainees were not found to be under the influence of substances, two individuals tested positive for methamphetamine. The operation resulted in 168 summons issued, with the bulk of them for riding without a license, followed by motorcycles being operated without side mirrors. In addition, 20 motorcycles were seized.

South of Ipoh, in Melaka, a 20-year-old motorcyclist was killed on the spot after the motorcyclist ran a red light, resulting in a collision with an SUV. The driver remains unharmed. Not worth the few minutes saved. 

GISB - a member has too many children to keep track
There are roughly 10,000 GISB members locally and abroad, children included, according to Bukit Aman. IGP Razarudin Husain says that the exact number is yet to be known as investigations are still ongoing. The members are said to practice “Aurad Muhammadiah” teachings, similar to the defunct Al-Arqam sect before being declared deviant in the early 90s.

One of the members, when interrogated by police, stated that he has 4 wives and 34 children and claimed that he does not know where 32 of them are. Investigations proceed to show that having this many kids and abandoning them is normal. Some crude behaviour here. The individual was among the 156 suspects detained during Ops Global last Saturday. Razarudin urged remaining GISB members to turn themselves in, with an emphasis on securing the welfare of the children involved in this case as he believes that all of the children rescued from the homes are offsprings of current members.

Business

1. Tealive-brand owner, Loob Holding Sdn Bhd, is eyeing the Indonesian market next year, only if the company reaches its KPI of having 100 stores in the Philippines first which it currently has 75 outlets. Loob Holding which was established in 2017 has already marked its presence in nine markets - Malaysia, Philippines, Vietnam, Myanmar, Australia, Cambodia, Brunei, Mauritius and Canada, via its more than 1,000 stores.

2. Another Malaysian company, TNG Digital, is also reaching for the skies as the company is planning to raise more than USD300 mil via a domestic initial public offering (IPO) in the next two to three years. TNG Digital is aiming to attain unicorn status (with a valuation of at least USD1 bil) before the potential IPO. The latest capital TNG Digital got was in 2022 when the company raised USD179.3 mil via an equity funding round led by Lazada.

How to enjoy the tax-free benefits in Forest City Special Financial Zone
First, you need to have tonnes of money, so much so that the zeros spill over to the next line on your phone screen. Then, set up your family office in Forest City. The Securities Commission (SC) established specific conditions for Single Family Office Vehicles (SFOVs) to qualify for a 0% concessionary tax rate as announced last Friday, targeted to be operational by the first quarter of 2025. SC Chairman Mohammad Faiz Azmi expects the economic multiplier of this initiative to be about RM3.9 bil to RM10.7 bil.

Here are the aforementioned conditions:

• Incorporation: SFOV must be a new investment holding company incorporated in Malaysia, with an established and operated office in Forest City’s Pulau 1, with SC pre-registration for tax incentives.

• Assets Under Management (AUM): SFOV must have a minimum AUM of RM30 mil.

• Local Investment: Invest at least 10% of total AUM or RM10 mil, whichever is lower, in eligible and promoted investments.

• Operating Expenditure: SFOV must incur a minimum annual operating expenditure of RM500,000 locally.

• Duration: Incentives are effective for an initial period of 10 years, with the possibility of an additional 10 years if SFOV’s AUM and annual operating expenditure increase to at least RM50 mil and RM650,000 respectively.

• Employment Requirements: Employ at least two full-time staff with at least one investment professional who earns a monthly salary floor of RM10,000.

Shorts

1. Steven Sim new Penang DAP Chairman
   Human Resource Minister Steven Sim has been appointed as the new chairman of Penang DAP for the 2024-2027 term, succeeding outgoing Chief Minister Chow Kon Yeow. In the recent state DAP elections, Sim received 1,237 votes, placing him second behind Ramkarpal Singh, who garnered 1,247 votes- Ramkarpal is set to be deputy chairman, with Steven at the helm. Steven, when talking to the press, indicated his eagerness to leave his mark at the party.

2. TVET option available for students uninterested in Form 4 and above
   Deputy PM Zahid Hamidi has announced a special program come year-end that allows students who are behind or disinterested in continuing their conventional studies past Form 3 to transition to technical and vocational education and training (TVET). This initiative, which includes a non-written test, aims to ensure that students can obtain qualifications equivalent to the conventional SPM through the Malaysian Skills Certificate. TVET grads could earn up to RM4,000 in a premium salary agreement with several GLC and private companies (e.g. Cypark, Penang Port, Khazanah Nasional).

3. Bukit Bintang sinkhole scare as Air Selangor pipes burst
   Just a month after the tragic case of an Indian national disappearing into a Jalan Masjid India sinkhole (and still not found), a water pipe leak in Jalan Bukit Bintang is causing concerns over another potential cavity. Rest assured, says KL Mayor Maimunah Sharif, as Air Selangor is undertaking repair works, and that no sinkholes are present on the road as well as in Jalan Sultan Ismail. View the situation here.

4. AROUND THE WORLD 🌎

Israel continues killing spree, risk turning Lebanon into next Gaza
Israel struck more than 300 Hezbollah targets in airstrikes that Lebanese authorities report has killed at least 182 people, marking the deadliest day in Lebanon in nearly a year of conflict. The Israeli Defence Minister has promised that the operations will continue until Israel’s northern residents can “safely return to their homes”. A Hezbollah deputy chief, speaking at the funeral of one of the group’s commanders, said the conflict is in a new phase, an “open-ended battle of reckoning”. The exchange of fire between the two factions has led to concern from other countries, with the UN chief fearing the “possibility of transforming Lebanon into another Gaza”, with the UN special coordinator in Lebanon posting on social media that the Middle East was “on the brink of imminent catastrophe”.

Back to Gaza, Israel continues with its daily routine with two more strikes in the central Gaza Strip killing at least 10 Palestinians, including four children. The strikes also come at a time when heavy rains and floods have further displaced tent encampments, with residents resorting to digging trenches to drain water away from their tents.

Meanwhile, the Iranian elite Revolutionary Guards Corps has ordered all members to stop using communications devices following the recent pager and walkie-talkie explosions that took out members of Hezbollah. A large-scale operation is also underway to inspect all devices, not just communications devices. Iran has arrested 12 people as well, on the grounds of being operatives collaborating with Israel and planning acts against Iran’s security.

Chip changes and global coffee woes

• Apollo, Qualcomm approached Intel with offers

  Asset manager Apollo offered to make an equity-like investment of up to USD5 bil in chipmaker Intel, which would be a nice vote of confidence in the tech giant’s turnaround strategy. However, nothing has been finalised, including the size of the investment. This comes as chip designer Qualcomm approached Intel to explore a possible acquisition of the troubled chipmaker. Nothing is set in stone, and no formal offer has been made yet. Should a deal materialise, it will likely face intense scrutiny from antitrust regulators in the US, China, and Europe.

• Vietnam's bad weather means world's coffee stays pricey

  A drought followed by weeks of heavy rain in Vietnam just before harvesting season has crushed hopes that a supply from the region will help lower prices of robusta beans in the face of surging global demand, with the harvest likely to be cut by up to 15% due to the weather. Vietnam produces one-third of the worldwide supply of robusta coffee beans. There were fewer and smaller beans produced, with processing also made difficult. This was further exacerbated by Typhoon Yagi, which made landfall in the north of Vietnam earlier this month. The bad weather combined with the typhoon means shipments of coffee from Vietnam will also be delayed by at least a month.

Shorts:

1. New Pokemon region: Indonesia

   The Pokemon Company will be further localising its games and products in Indonesia to expand its penetration there, considering the lower-than-expected popularity of its franchise in a nation with “such a big population and developing economy”. The company held events throughout the country, with its star character Pikachu dressed in batik to “respect the local culture”. According to a company official, the event in Bali alone “earned USD13.6 mil”, which includes USD1.4 mil in tax for the government.

2. Facebook co-founder donates USD15 mil to SG school

   Eduardo Saverin, Facebook’s co-founder and currently the wealthiest person living in Singapore, donated USD15.5 mil to the Singapore American School, the largest donation it has ever received. The school is a prestigious one, charging USD47,000 a year in tuition and only 4,100 students enrolled, with more than half of them US citizens. The funds will go toward funding new laboratories and a new elementary school, as well as the school’s Chinese immersion programme. The donation is a “significant and meaningful” way for the Saverins to contribute to the school and community, according to the school. The rich donating to the rich. Hmm.

3. Apple's legendary designer working on new startup with OpenAI

   Former Apple designer Jony Ive confirmed that he is working on a new startup with OpenAI and Sam Altman, the CEO of OpenAI. The collaboration was first reported last year, with Ive’s LoveFrom leading the design. The goal is to build a “product that uses A.I. to create a computing experience that is less socially disruptive than the iPhone”. The startup is fundraising, with a report suggesting it aims to raise USD1 bil by the end of the year.

5. FOR YOUR EYES 📺

1. A world flush with wealth yet drowning in debt (view global debt infographic here)

2. What do you do on PornHub? For most people, especially us, is to learn mathematics. Here’s the story of a Taiwanese math teacher who took an unconventional approach to teaching maths and making money out of it.

3. We explain US interest rate cut in the Malaysian context