Bruneians and their toys

As I said never say never again, I cannot resist in making some comments regarding the more stringent enforcement of down-payment for car purchases. Firstly, I say it’s about time! This should have been enforced many years ago. Secondly, before many of you hurl all sorts of negative remarks toward the ministry and its directive, I urge you to think twice. Believe you me, this policy is not about making the rich gets richer or the poor gets poorer (i.e. the argument that poor-people-now-can –no-longer-afford-to-buy-cars or make it ‘expensive cars’), in fact it is the opposite.

The previous lax in the enforcement has made many Bruneians spent what they could not afford. This is what we called ‘wealth illusion’. We think we are ‘wealthier’ because we can afford to buy new and big cars, without even batting an eyelash. When in actual fact, we have actually trapped ourselves into ‘debt-slavery’. Don’t many of you feel that the more you earn, the less you actually take home? I’m not going to talk about how the US started (and now many parts of the world) its recession, but in one line, it is really due to this slavery.

Anyway, it should also bring good news to consumers. I am predicting (well hoping actually) that this policy will have an impact on the price of cars in Brunei. [To economics students, don’t read the next paragraph, think about it for a moment :)]

The policy will reduce the demand for cars. If the car-dealers are behaving ‘normally’, they will have to knock down the prices of cars (hurray for me! as we need to buy one) at the expense of their profit margin and perhaps the commission of our friendly car-salespersons. Either that or the interest rates will be knocked down.

So, there. That’s what I think and ought to happen. I’d be quite surprised if it doesn’t. I don’t think the demand will be unchanged since there are already too many cars waiting (at home) to be driven by too few people in Brunei.

Next, credit cards please!

Salaam.