The currencies of the countries of SE Asia fell heavily in the 1997-98 period. Many are still not worth much relative to the Euro and the US dollar, and the recent trend is down. An exception is the ringgit of Malaysia. It hangs, surprisingly stable, suspended sisterly from the US dollar by the blustery breath of Malaysia's preachy and prating prime minister; little else.

Daim, the ex-finance minister, drew fire, and now is hidden somewhere under the carpet, letting his proteges take the heat. The investments linked to his helping hand are under heavy selling pressure, the share market price sliding slowly down, down. UEM, Renong, Time, Time.Com, and a butcher's basket of other deeply indebted firms in the late, great finance minister's personal portfolio are in trouble; big trouble. And there is no one and no money to bail them out anymore.

The banks, having extended unsound credit, are faced with bigger and better write-offs, and there is no end to the trend. Government agencies established to sponge huge non-performing loans are saturated to the dripping point. Government funding for Danaharta, Danamodal and the Credit Restructuring Agency is exhausted, and plans are announced of intent to close the doors.

Every day the list of defaults lengthens. Applications to extend, yet again, previous defaults, meet a market made miserly by mendacity. The famous put option asks to be put off yet again. Where is the morality of the market if a man's word is no good anymore? Markets depend on the honouring of verbal agreements.

An offer by open outcry, once accepted, is a done deal, and all in hearing are witness to it. Failure to perform is grounds for banishment in any exchange, just as those who give a verbal telephone order to a broker are expected to honour it when the confirmation arrives. Those who renege, for whatever reason, have their accounts closed and are everywhere black-balled. That is the way the game is played.

Everywhere but in Malaysia, that is, where a contract is not a contract until the prime minister says it is. In a famous recent incident he declared that payments to honour a decades old royalty contract had suddenly deteriorated into a voluntary "good will" offering. There was no contractual obligation to make the royalty payments, he said. Acting on this view, he promptly claimed the multi-million dollar payment for himself and his party-in-power.

Observers noted he was not a party to the contract. The payee, a northern state now in the hands of the opposition, sued. The courts are now to re-consider the situation. The prime minister has no defense other than he needs the money, and he is well advised to make preparations for reparations, interest, penalties, costs and all. Justice will be done, and in this case, one hopes it will be well done.

The prime minister has pegged the ringgit to the US dollar by fiat at a rate of 3.8 to one. It fluctuates on the world currency float alongside the dollar. The prime minister says the peg has saved Malaysia from the fate of its neighbors. "Now no one can benefit from trading in the ringgit," he says. "The ringgit is only good in Malaysia," he says. He is correct on both counts. But there is more.

What he does not say is the obvious. Malaysia, a country of 23 million, is in the unfortunate position of guaranteeing the ringgit. This simply means that the central bank guarantees anyone in the world holding ringgits, that it will exchange them on the basis of 3.8 ringgits to one dollar. As if to say, "Bring me 3.8 ringgits, and I will give you the dollar." The Central Bank says it is prepared to do this indefinitely, staring you strongly in the eye.

It is clear to even an idiot, to borrow a favorite term of opprobrium in frequent use these days by the prime minister, that the guarantee is only good so long as the pile of dollars holds out. If an idiot shows up the day after the pile is exhausted, too bad. All the dollars have been taken, and the idiot must trade his ringgits where he can, accepting the best rate available. When the central bank defaults at the exchange counter, all bets on the peg are off.

That raises the obvious question, how big is the pile now? How many dollars does the Bank Negara have left? They say they have enough to cover four months of dollar valued imports, and they consider that sufficient. Maybe so. Maybe not.

The Bank Negara is arranging underwriting with major US institutions for a big, billion US dollar-denominated bond. An idiot can see Malaysia needs dollars, and lots of them. Some is needed for more pump priming. Some is needed for more crony bail-outs to come. There is the reminder of the recent Timedotcom underwriting, in which the announced supporting institutions were later seen simply as shills set up by the ex-finance minister, shelling public money from the national pension and investment funds into the pockets of himself and friends.

That was before the ex-finance minister left his office. Are the national treasury bonds of Malaysia backed by the full faith and credit of the Malaysian government? The prime minister, who says he is new at the finance game, says so.

A number of bond offerings have been put on the market in the past year. Most have found few takers. Who wants to do business with a country when the table is tilted? The risks are just too high, and this is true even for managers hiding behind a statistics based investment policy, and entrusted to use (and lose) other peoples money. But the story is better told by the travelling ex-finance minister, available now world-wide to personally persuade international bankers to buy the new national bonds.

The real reason Malaysian bonds don't do well is simply that the ministers are not men of their word. They cannot tell the truth to save themselves and the country. The minister of international trade challenged a business group to organise their own anti-corruption agency, and if it found evidence of bribery or other forms of unethical conduct, "then tell us about it" she said.

Hollow words, and meaningless, simply because the prime minister and his cabal already have an ACA that is totally ineffective in dealing with the internal thefts of the party-in-power. Sworn court testimony that the prime minister forestalled an ACA investigation was hushed up, but the whole world knows the sort of man he is. He had the brass to tell a judge who found the prime minister's party guilty of wholesale election fraud and vote rigging that, "He should have brought the matter to me."

The judge, and all the world, knows the prime minister's record when things are brought to him. He covers it up in a blatant obstruction of justice. He provides immunity to all his felonious friends, fellows and family. The ACA announced that an investigation into a five billion dollar bond scam would be completed in two weeks. That was in January, and came after an investigation that originated the July past. Since then the director of the ACA has been removed, and there has been not a peep from that direction since. Nothing has been done on the prime minister's obstruction of justice, nothing on the bond scam, nor any other of dozens of cases that should have been prosecuted long ago.

Against this backdrop Malaysia wishes to offer a multi-billion dollar bond issue. Not in ringgit, but in US dollars. For internal consumption the prime minister launches tirades against "the wicked west," with their "lying, slanderous" media and unscrupulous "Jewish currency traders," is now asked to take Malaysian paper and promises for the US dollars desperately needed to waste more money on ridiculous projects like the Bakun dam, and to keep the Malaysian pyramid scheme going.

In order to make payments on present debts, now due in dollars, more of the dollars must be in hand. The debt grows because the original loan calls for payments on the principal, plus accrued interest. Whenever someone repeatedly entices new money to forestall default on old debt, all the makings of a pyramid or Ponzi scheme are present. Ponzi went to prison. It is the thing of boiler room operators, not a national treasury.

Malaysia has run all its credit cards to the limit. And now more cards are applied for to make payments on the existing cards. There is no debt consolidation in sight. There is no financial consultant to give advice on prudent spending, or to help work out a re-payment schedule. Instead, there is to be new and greater spending, using the money of the hated "white man" whose "globalising greed" is his only motivation.

The prime minister is doomed to eat alone. None will come to his table. He has broken his word too often. He not only reneges, he lies and dissembles. A liar soon loses his following, and in this case, the poor country must suffer with him. He is full of hate, and thus hateful. His recent racial remarks are reminiscent of Corporal Schickelgruber, who motivated his mesmerised idiots with dreams of national supremacy ("Germany over everyone") justifying mass crematoria as a "final solution" for what he raged against as "the untermenschen problem." He drew large crowds of the prime minister's idiots.

When the new Malaysian bonds are issued, and the buyers properly shun them, the burungs will return to roost, and the droppings will fall onto the fallow fields of Putrajaya. Scattered about are the scarecrow ministers of the party-in-power, standing stalwart and staunch, not noticing, seeming not to feel or note events.

But the young are willing to tell, and the foreigners are willing to tell. Unfortunately, the ministers listen only to their master's voice, which has become wispy and rasping, the harangue of a racist demagogue masquerading in the national garb of a Malay Muslim. Some of the idiots in his party seem fooled.

It is widely hoped that soon he, like the Pied Piper of fable, will leave town, leading his loyal rats trailing away behind him. Only then will the false arrests stop; the courtroom sandiwara's will cease. Only then the repressive laws against basic human rights will be repealed. Only then will the political prisoners be released. Only then will freedom of speech, freedom of the press, and freedom of peaceful assembly be restored. Only then will protection from police brutality and political prosecution be possible, supervised and enforced by an independent and honourable judiciary.

Only then will the Sultans restore integrity and morality to the election commission, as the Constitution demands. Only then will the bribery, theft and immoral conduct in top circles be promptly and fairly prosecuted by independent and honest officers of the court. Only then may all judges hand down rulings with fairness and justice, free of intimidation from executive vengeance or critique. Only then will the political killings stop.

Then, and only then, will a bond bearing the seal of Malaysia be a fit and marketable commercial instrument.

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