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Rupiah Rises Rp. 14,700 per US Dollar, Darmin: Impact of Argentina

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The performance of the rupiah is considered to be one of the worst.

Jakarta, Coordinating Minister for Economic Affairs Darmin Nasution said the financial crisis in Argentina had the most dominant impact on the weakening of the rupiah exchange rate. For information, the rupiah has penetrated the level of Rp. 14,700 per US dollar.

“That is (weakening of the rupiah) because there are problems with other countries, in Argentina,” Darmin said at the office of the Coordinating Ministry for Economic Affairs, Jakarta on Friday (31/8).

Darmin said, the problems that occurred in Argentina were quite surprising. This is because the state of Tango has received assistance from the International Monetary Fund (IMF) of 50 billion US dollars. However, it turned out that it had not been able to help the movement of capital outflows so they had to raise interest rates to 60 percent.

“But yes, surely a country that does have a problem that is deep enough in the matter of balance of payments will certainly be a way of being affected,” said the former Governor of Bank Indonesia.

Darmin said that in general the crisis would continue to have an impact on Indonesian financial markets until the problem in Argentina ended. He stressed, the impact was not only felt by Indonesia but also other countries.

“Developed countries, like the UK are all affected. Not only developing countries,” Darmin said.

Based on the Indonesian bank’s middle exchange rate, the middle exchange rate at the opening on Friday (31/8) has touched IDR 17,100 per US dollar.

FXTM Research Analyst Lukman Otunuga said the rupiah was one of the most labor-intensive currencies in Asia in 2018. Bank Indonesia’s (BI) efforts to raise benchmark interest rates had no effect. “The rupiah has remained weak even though the benchmark interest rate has been increased four times since May,” he said in a statement quoted from, Thursday (8/30).

He revealed that the rupiah’s downturn was especially the case when global trade war tensions took place. Conditions were exacerbated by expectations of money market players regarding the US Federal Reserve’s central bank’s benchmark interest rate hike. According to Lukman, the Fed is predicted to increase its benchmark interest rate in September. “The dollar will be stable so that the rupiah has the potential to continue to weaken,” he explained.

So far BI’s benchmark interest rate is at 5.5 percent while the Fed’s interest rate ranges from 1.75-2 percent. Since the BI era led by Perry Warjiyo, BI has pursued tightening monetary policy through rising interest rates to stabilize the value of the rupiah against the US dollar.

Quoting the BI Interbank Spot BI Dollar, Thursday (8/30) the rupiah was traded at Rp. 14,655 per US dollar. This level is the deepest weakening since September 2015. Lukman said, money market players will continue to observe the development of the rupiah. He considered that the rupiah which had exceeded the Rp. 14,650 level had the potential to continue to weaken to Rp. 14,720.

He added, tensions in global markets could re-inflame if US President Donald Trump raises the cost of product import tariffs from China worth 200 billion dollars on September 5. Restless money market investors await Trump’s decision.

Meanwhile, the Financial Services Authority (OJK) stated that, based on the OJK Board of Commissioners ‘Meeting, the stability of the financial services sector and liquidity conditions in Indonesia’s financial markets were still in good condition amid pressure on developing countries’ financial markets.

On the domestic side, economic growth in the second quarter of 2018 showed improvement compared to the same period of the previous year. The inflation rate is at a controlled level. In addition, domestic corporate performance is still adequate. This was reflected in the financial performance of the issuers of the Indonesia Stock Exchange, which mostly recorded improvements.


Already an Investor Since the Age of 11, What is the Secret of Warren Buffett’s Successful Investment?



US, Who doesn’t know the name Warren Buffett? One of the world’s richest people is known as an accomplished investor.

Born in Omaha, Nebraska, USA on August 30, 1930, Forbes noted that Buffett’s wealth reached US $ 84 billion as of March 6, 2018.

Of course it’s not easy to reach his position now. As someone who has started investing since he was 11 years old, he has a separate approach before deciding to invest in a business or company.

Reporting from Forbes, Friday (08/31/2018), there are several things that are important pillars that influence Buffett’s decision to invest. Anything?

First, be patient. He once owned several shares in Cities Service (now CITGO), a US oil company, at a price of US $ 38 per share. When the company’s stock fluctuated in the range of US $ 27-US $ 40, Buffett withdrew his investment.

However, it turned out that the company’s shares then jumped to US $ 202. At that time, he realized the importance of being patient and holding positions.

Second, always study the business that is as much as possible for investment and research.

Third, get compound interest from the investments made. Compound interest is the interest rate or interest calculated on the principal loan plus interest earned previously.

Selling effects makes Buffett learn about the benefits of compound interest. In fact, he knew he could retire at the age of 25 by relying only on interest from his assets worth US $ 127,000.

However, the father of three children finally remained retired because clients and business partners continued to arrive. Over time, his expertise in sniffing out promising investments continued to be honed.

No wonder he was dubbed the Oracle of Omaha alias the Soothsayer from Omaha.

“Look for a good business with resilience, competitive advantage, run by capable and honest people, and available at reasonable prices,” Buffett said of his strategy.

However, not all sectors are able to attract themselves to invest. For example, technology companies like Alphabet or e-commerce like Amazon.

Reporting from Reuters, Buffett claimed to monitor Amazon’s performance from the start and assess the work of Jeff Bezos, the founder of Amazon, was extraordinary. However, that is not enough to make him a Bezos partner.

“I will miss a lot of things that I don’t understand well. We are trying to be in our area of ​​competence and Charlie [Berkshire Hathaway Inc. Charlie Munger’s Vice Chairman] and I generally agree on where the area ends … We tried to be in the area. Our competence … We will miss a lot of things, “he explained.

However, it’s still the story of Buffett who is considered successful in saving the other side. Do you know if Berkshire, the conglomerate company he leads until now is actually considered an investment mistake by Buffett?

He began investing in Berkshire when the company was still fully engaged in the textile sector, precisely in 1965. At that time, Berkshire’s financial condition was weak.

“Half of our capital is in businesses that are not running and that is not smart. We are trying to get out of that condition by developing capital elsewhere,” Buffett told Forbes in 1993.

Under his leadership, Berkshire also expanded to various business lines such as insurance, transportation, food and beverage, and retail companies. This business expansion proved to be profitable and now the company already has at least 60 companies.

In fact, investment in Government Employees Insurance Company (GEICO) – whose shares are owned by Berkshire – is recognized as one of Buffett’s favorites. The motor vehicle insurance company was able to provide profits despite giving lower rates to consumers than its competitors.

GEICO is also an important component in the Buffett conglomerate whose total market capitalization reaches US $ 480 billion as of December 2017.

Despite having enormous wealth, but – like Bill Gates – he gave most of his wealth to charity. To date, he has granted nearly US $ 32 billion, mostly to the Gates Foundation.

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Jack Ma and Business Keep Relevant



This morning (1/9/2018), the Alibababa Group CEO met with President Joko Widodo at the Bogor Palace. The presence of Chinese businessmen is very popular because this e-commerce business was warmly welcomed by Jokowi.

Jack Ma was in Indonesia in the framework of the Asian Games, and had witnessed the final match of women’s football which brought together his country of origin, China and Japan. The skinny man who is now the 20th richest person in the world is planned to also be present at the closing ceremony of the Asian Games at GBK Main Stadium, Sunday (02/09/2018).

Who is actually Jack Ma, so inspiring so many people? He said, at one time, when people had not become anyone what he said would pass like a fart, but if it was successful, even fart would be an inspiration. The following is a story about Jack Ma, and how to keep business relevant.

On two occasions at different times and places, ESDM Minister Ignasius Jonan inserted a video of Jack Ma’s speech, Founder of Alibaba Group — one of the world’s largest e-commerce companies from China — in his presentation material.

This is a snippet of speeches at the Gateway 17 event, held in Detroit, United States, mid-2017.

I watched the video play when Jonan spoke to Indonesian oil expatriates working in Texas at a meeting at the Consulate General of the Republic of Indonesia Houston at the end of July 2017. The second screening, a month later, took place in a focus group discussion on electric cars attended all stakeholders, in Nusa Dua Bali.

Gateway 17 is the story of Jack Ma along with 16 of his colleagues bringing a large Alibaba like now. The story of how the slim man did the impossible, how to deal with failure — he was once the only candidate who failed to become a KFC fast food restaurant waiter from 24 registrants — and made Alibaba the most talked about and admired company.

Jack Ma has also been refused 10 times when registering at Harvard University, then shared his tips. One of them is the secret of Alibaba’s success by recruiting more female employees. Women, according to him, are more concerned with other people than men. “Man, thinking of himself.”

In the 21st century, women will be more powerful because in the previous century people measured muscle strength. Today, people are compared with wisdom. “Recruiting women as much as possible is what we do,” said Jack Ma, who a few weeks ago, through Alibaba, injected IDR 14 trillion in capital to an Indonesian e-commerce company, Tokopedia.

Next, Jack Ma provides advice for young people. “If you are 20 years old, look for a good company and find a great boss to learn to run a business. If you are 30, try working for yourself. When 40, do something you are an expert at. If you are 50, please give an opportunity to young people. If you’re 60, it’s better to spend time with grandchildren. ”

Two tips presented by Jack Ma, imply a strong message about a changing world. The business pendulum also shifted. That is why Jonan seems so fond of this message. According to him, any organization must be responsive to changes in the environment and times.

In the end, to the hundreds of Indonesian expatriates in the US who were present at the meeting, Jonan said that the oil business had also changed towards efficient management of natural resources. The oil business model is thus different and needs to be updated.

Moreover, with commodity prices plunging free from their highest position in 2013. It is undeniable that disruptive innovation has hit a sector that had been in a comfort zone for several decades; the engineers get first class service and exorbitant salaries.

In front of the automotive industry stakeholders, Jonan also brought a similar message; electric car technology is a necessity. Therefore, Indonesia cannot wait anymore, besides preparing to adopt technology in all ways; changing automotive manufacturer specifications, importing whole cars, even banning the sale of oil-fueled vehicles in 2040.

If that happens, there is clearly a disruption in the Indonesian automotive industry. On paper, there will be an efficient use of fossil fuels, because electric cars do not depend on one source of energy. The question is, are industry players ready?

Electricity can be sourced from coal, hydropower, wind, sunlight, biomass and so on. Very few plants in Indonesia are still using diesel fuel.

Therefore, if Indonesian society shifts to electric cars, then it is clear that crude oil imports of 800,000 barrels per day will be drastically reduced. With the current price, put US $ 50 per barrel, then there is a need for foreign exchange of US $ 40 million per day, or US $ 14.6 billion a year, which is Rp192 trillion!

It should be noted, the daily consumption of fuel oil in Indonesia is 1.6 million barrels, half of which can be produced domestically. Reduced imports, meaning that foreign exchange use can be saved and the rupiah has a greater chance of strengthening.

As a change discourse, of course the above calculations will be tested by history. However, the explanation is very reasonable because after all the source of oil will dry up. Indonesia is not alone in anticipating this change, as is done by Norway, Britain, the United States, Germany, and even India.

In short, the relevance of the oil-fueled vehicle business will continue to decrease in the next 10-20 years. People’s mobility can also shrink because with technology people can work anywhere. Face to face is certainly still important, but only as needed.

In the last few weeks, I met a number of seasoned bankers. I call veterans because their average career has been in the financial industry for more than a quarter of a century. Strangely, all save concerns, whether the bank’s business will still be relevant in the midst of the massive digital economy that is sweeping the world.

Anika Faisal, Director of PT Bank Tabungan Pensiunan Nasional Tbk. (BTPN) is one of them. For him, the digital economy has rapidly changed the banking industry landscape, which currently still controls 70% of assets in the Indonesian financial system. “Is the presence of a bank branch still needed when most transactions can be done digitally?” Asked Anika.

This question is actually rhetorical, because financial institutions such as BTPN have anticipated developing digital banking, more than other banks do. They have BTPN WOW !, an effort to expand the market at the grassroots by making mobile phone numbers as accounts.

With a product called Genius, this bank can also service account opening through a mobile application, and only requires one verification from its staff by visiting customers. BTPN, which was formerly a retired bank with aging customers, was willing to spend almost Rp1 trillion on technology development.

In fact, BTPN conjured up one of the floors in the headquarters of the Mega Kuningan area in South Jakarta, as a place to innovate fintech development that was packaged like a startup company, with millennials employees. They are like emptying a glass, then letting fill with new things from the young people they recruit.

However, from what I caught, BTPN seemed to have an unfinished strategy, including in accelerating change by involving all employees.

In other banks, such as PT CIMB Niaga Tbk, (BNGA) instead took a tactical step, reducing 1,200 employees — about 10% of the total workforce — along with the decrease in banking transactions through branches.

When visiting Bisnis Indonesia office, last month, CIMB Niaga Bank President Director Tigor Siahaan said 93% of the bank’s daily banking transactions were managed through digital.

Meanwhile, President Director of PT Bank Central Asia Tbk. (BBCA) Jahja Setiaatmadja, 97% of BCA’s 18 million daily transactions are now done digitally, although the remaining 3% still dominates the transaction volume by 56%.

Bank challenges also do not stop at how to transact. However, also with demands for services that are far more efficient. Call in terms of time-consuming credit disbursement. Bank competitors are no longer startup companies that create new, cheap and fast financial ecosystems, but also other companies, such as the telecommunications industry.

Through electronic money services, telecommunications companies such as PT Indosat Tbk. and PT Telekomunikasi Selular (Telkomsel) can raise trillions of rupiah. GoJek — an online transportation company that already has 30 million customers — developed Go Pay as a new payment instrument for various transactions and half of the customers have been willing to put some money in the virtual payment service.

Like oil companies, banks now also need to renovate business models to remain relevant. In fact, if you want to be honest, all industries now have the same challenges in facing the transition of the digital economy today.

Finally, management science may have to be dismantled, because what we learned and developed last year is not necessarily relevant today. Corporations should continue to look for new business models, so that changes will not be quickly eroded.

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MSNBC finishes first in primetime basic cable for first time ever

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