Wednesday, 30 March 2011

The magic number?

Generally, economists like a specific number - a magic number, so to speak - to tell them how best to describe the situation. Failing which, there are always the local authorities who would be generous enough to draw that demarcation line for the rest of us.

Anyway, I don't know whether anyone else noticed, but there's a lot of emphasis on that RM3,000 per month wage lately... (am referring to the new credit card rules and the 100% loan given to prospective home buyers below that income threshold). But maybe it's just me reading too many Bank Negara reports.

From the chart above, that's a lot of people who are going to get affected (over 3 million households from the looks of it)... Am expecting slight changes in aggregate consumption and savings patterns in the near-term.

And before anyone asks, Malaysia's average household size in 2010 is around 4.3. But let's leave demographics for another day.

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