☕️ Passport renewal application rejected over the lack of BM proficiency

1. MARKET SUMMARY 📈

2. NUMBERS AT A GLANCE 🔢

The House of Mouse brought in USD40.3 bil in economic activity in Florida in 2022, contributing about 3% of the US state’s GDP of USD1.4 tril, according to a new study from Oxford Economics (commissioned by Disney). This figure includes direct and indirect economic activity from the Walt Disney World Resort, Disney Vacation Club and Disney Cruise Line. Disney is responsible for 263,000 jobs directly and indirectly across the state, employing about 2% of Florida’s 11.154 mil jobs. Disney now hires 82,000 people in Florida. No wonder the Malacca state government got confused about Disneyland's ‘opening’ in Malacca - too excited with the economic prospects. Read the report here.

The big US banks are sitting on unrealised losses of USD650 bil as bond prices crash. The Treasury bond (US government-issued debt) meltdown earlier took down several banks in the US back in March. When customers deposit funds into the banks, they either lend it out or invest it in US Treasuries. The rapid rise in interest rates last year led to the crash of these bond prices as they moved inversely with interest rates, leading to these massive losses. For now, it’s unrealised, and so long as the banks are not forced to sell these bonds at market prices, all will be good. Bank of America is the worst affected, having disclosed a potential USD130 bil hole in its balance sheet last month.

This might just be the most expensive, smallest piece of paper ever. The “Inverted Jenny” stamp was sold for USD2 mil (RM9.35 mil) in a New York auction, making it the most expensive single US stamp sold. Originally cost 24 cents, the stamp dates back to 1918, with only 100 printed then. What made it even more unique is the plane depicted in the stamp was printed in error upside down. The stamp is so famous that it was once featured in an episode of The Simpsons. The buyer had bought two stamps from the collection — once in the early 2000s for USD300,000 and another in 2007 for nearly USD1 mil.

3. IN MALAYSIA 🇲🇾

Malaysian Bar vs Ahmad Zahid Hamidi’s DNAAThe Malaysian Bar has filed a judicial review at the High Court, contesting the former AG's decision for a discharge not amounting to an acquittal (DNAA) in the case involving 47 charges against Deputy PM Datuk Seri Ahmad Zahid Hamidi. The Bar seeks various declarations and information regarding the decision, emphasising the importance of checks and balances in upholding the Federal Constitution. 

In a piece of separate news, Zahid, denying cancer rumours and resignation as Umno president due to health reasons, clarified his recent absence, affirming his good health. He also dismissed the Kemaman by-election results as not indicative of a public referendum, highlighting low voter turnout and stating it doesn't imply increased support for PAS or a disapproval of PM Anwar's leadership. PAS retained the seat with a significant majority, drawing different interpretations from various political figures.

Passport renewal application rejected over BM proficiencyHome Minister Datuk Seri Saifuddin Nasution Ismail emphasised that proficiency in Bahasa Malaysia is an essential requirement for Malaysian passport holders, aligning with the stipulation in the Federal Constitution. Responding to a recent passport application incident in Johor, Saifuddin Nasution highlighted the necessity for language proficiency, citing similar requirements for citizenship in advanced countries like Singapore and the UK. He clarified that language understanding is crucial for eligibility and addressed a case where an Immigration official in Johor reportedly investigated a passport renewal due to parental resemblance concerns and past identity card forgery reports.

Shafee and LHDN in process of resolving RM9.41 mil tax suitNajib Razak’s hotshot Lawyer Muhammad Shafee Abdullah and the Inland Revenue Board (LHDN) are currently working towards settling a lawsuit, where LHDN seeks to recover over RM9.41 mil in income tax owed by Shafee. Shafee's representative, Rajan Navaratnam, informed the High Court about the ongoing settlement discussions, requesting an adjournment of the hearing scheduled for today. The court set a new hearing date for LHDN's summary judgment application on Dec 15. Both parties are exploring settlement possibilities, aiming for an amicable resolution. The suit was initiated by LHDN in May 2021, alleging Shafee's failure to pay income tax arrears for assessment years between 2011 and 2016.

Government plans to announce new NEM quota as rooftop solar capacity reaches limitThe government aims to increase rooftop solar quotas due to overwhelming demand, with the existing capacity fully utilized. The Ministry of Natural Resources, Environment and Climate Change (NRECC) plans to announce new net energy metering* (NEM) quotas for homes, businesses, and industries. This move aligns with efforts to promote renewable energy adoption. The surge in solar uptake this year followed changes in electricity tariffs, encouraging eco-friendly practices. Malaysia's potential for rooftop solar stands at 42GW, as per the 2022 Renewable Energy Roadmap, prompting exploration of leasing and buy-back solar schemes to further expand solar integration.*Under a NEM mechanism, a consumer can sell excess electricity generated to the national grid and receive credit to offset his/her next electricity bill. 

KWAP secures RM227 mil deal for Singapore-based workers' accommodation assetsRetirement Fund (Incorporated) (KWAP) has finalised plans to acquire two workers' accommodation properties from Centurion Corporation Limited, a Singapore-based operator, for RM227 mil. This acquisition involves Westlite Bukit Minyak (3,321 beds) in Penang and Westlite Tampoi (5,790 beds) in Johor, where Centurion will lease back the properties for 15 years after KWAP completes the purchase. Centurion is expanding its Malaysia purpose-built workers’ accommodation (PBWA) capacity in response to rising demand for PBWA, also known as centralised living quarters. Think of PBWA as a property investment but renting out to workers on a per-bed basis, which could go range from RM155 to RM300 per month per bed, according to Knight Frank Malaysia. Read: Workers’ housing is a new emerging asset class, according to Knight Frank Malaysia.

Shorts

1. Beware of eMadani scam — The Finance Ministry issued a warning about scams involving eMadani credit offers for cash-out or transfers. They clarified that losses won't be covered and stated plans for strict action against offenders. It's important to note that eMadani credit is intended solely for making purchases and cannot be used for transferring cash. 

2. Ethical AI rules incoming — The Ministry of Science, Technology, and Innovation (Mosti) aims to introduce clear rules for ethical AI use by early 2024. Minister Chang Lih Kang highlighted the need for these guidelines as there are currently no set standards for AI across different fields. The goal is to address concerns about privacy, security, and the impact of AI on society. 

3. Mount Kinabalu turned ‘river’, climbers safely evacuated — 49 climbers on Mount Kinabalu were safely evacuated as heavy rains turned the summit trail into rapids. Guides and porters assisted their descent as strong water flows descended the trail following Monday morning's downpour. No incidents were reported during the evacuation. Watch the scene here on the mountain. 

4. AROUND THE WORLD 🌎

Qatar on Israel-Hamas truce, ‘Israeli crimes’A week-long Israel-Hamas truce, which Qatar brokered with the support of Egypt and the US came to an end on Friday with both sides accusing each other of violating the conditions of the deal. The initial truce led to the release of 80 Israeli captives in exchange for 240 Palestinian prisoners. Qatar’s Prime Minister, Sheikh Mohammad bin Abdulrahman bin Jassim al Thani, said Qatar would continue to facilitate another truce and reach a permanent ceasefire in the Gaza Strip. Interestingly, given its position as the middleman, Qatar is also calling for an “immediate, comprehensive and impartial international investigation” into what Qatar’s PM called Israeli crimes in Gaza. 

Meanwhile, Israel’s current and longest-serving PM, Benjamin Netanyahu, will see his long-running corruption trial resume after the trial was paused on an emergency order from the country’s justice minister following Hamas’s attack on Israel on Oct 7. 

Job loss at Spotify, Klarna: One due to firing, another due to AI

• Spotify’s own organisation 2023 wrapped is here, albeit a sombre one - the music streaming giant announced its third round of layoffs as it will let go 1,500 employees, or 17% of its workforce, to rein in on its costs, after letting 600 of its staff go in Jan, and 200 more in June. Spotify said it will incur EUR130-145 mil in charges in the coming quarter due to the layoffs and is expecting an operating loss of between EUR93-108 mil as compared to its prior forecast of EUR37 mil. This news sent its shares soaring 11% to trade near its 2-year high of USD200.46. 

• Early signs of AI coming for human jobs. The Swedish Buy Now Pay Later giant Klarna said it will no longer hire new staff beyond its engineering department. This is not due to the hiring freeze but rather due to productivity gains from using AI-powered tools such as ChatGPT, which would lead to the company shrinking, according to Klarna CEO Sebastian Siemiatkowski. The company has no plans to lay off workers, but natural attrition would mean the company will shrink over time, with AI picking up the slack from lost staffers. 

The Telegraph created a table listing and scoring occupations at risk of being replaced by AI — check out here how much at risk your current and future jobs are by AI.

Deals

• ChatGPT maker OpenAI is paying USD51 mil to Rain AI, a chip startup, when its chip comes out. The startup makes chips that imitate how brains work and aims to build “cost and energy-efficient hardware” for AI companies. The startup made an interesting disclosure - OpenAI CEO Sam Altman invested over USD1 mil of his own cash in the firm. 

• Saudi Arabia’s shopping spree continues. The oil nation’s sovereign wealth fund Public Investment Fund (PIF), will acquire a 49% stake in luxury hotel group Rocco Forte Hotels, valuing the company at an enterprise value of GBP1.4 bil. Founded in 1996, the company owns 14 hotels and 20 private villas. The company reported revenue of GBP300 mil and core profit of GBP60 mil last year.Learn:What is the difference between enterprise value vs equity value.

• Singapore’s state investment fund GIC is also continuing its shopping spree - for warehouses. GIC acquired two logistic facilities developed by Japanese real estate developer Daiwa House Industry for an undisclosed sum. GIC has already acquired several logistic facilities developed by the same developer in 2023, including a portfolio of 6 warehouses across Japan, which were purchased in April for USD800 mil from Blackstone. 

Shorts

1. Meta vs Spanish news sites — Facebook parent Meta Platforms is facing a EUR550 mil lawsuit from a group representing 83 Spanish media outlets, citing unfair competition in the advertising market. The group said Meta’s massive database of users and their personal data across its platforms allows Meta an unfair advantage in designing and offering personalised ads that constitute unfair competition. 

2. Deadly volcano eruption in Indonesia — 11 people were killed and 12 more are missing after the eruption of Indonesia’s 2,891-meter Mount Merapi (see map here) in West Sumatra. 75 people were in the area when it erupted and 26 were not evacuated. Mount Merapi is currently on the second alert level of Indonesia’s four-step warning scale, and its last known eruption in 1979 killed 60 people. Indonesia has 127 active volcanoes.

5. FOR YOUR EYES 📺

1. You have less than 30 days to max out your tax reliefs for 2023. View some summary of the items below entitled for tax reliefs.

2. Many investors invest in dividend-paying stocks. Is it actually a good idea? To us, investing primarily for dividends is a flawed approach. Having dividends in the pocket gives a false sense of ROI when little consideration is given towards the company’s share price movement. Yielding 3% in dividends, but share price down 10% — what’s the point? #notfinancialadviceRead: Why Warren Buffett’s Berkshire Hathaway doesn’t pay dividends?