Multimedia and Communication Minister Salleh Said Keruak today recalled how a rumour about then prime minister Dr Mahathir Mohamad’s daughter “eloping with an Indian man” had caused stock markets here and across the Causeway to dip.

“What economic fundamentals caused the stock markets to dip?” he asked.

“None at all, other than unfounded rumours that were later proven false and the stock market went up again. And even if the story was true, why should the stock market be affected?” he added.

The minister said there are numerous “doomsday predictions by prophets of doom” regarding Malaysia’s economic situation.

He said these are mostly Malaysians opposed to Prime Minister Najib Abdul Razak and their claims are more political rhetoric than financial analyses based on economic fundamentals.

“Time and again, this has shown that Malaysians react to rumours and even if the rumour has no bearing on the economy, people still panic,” he added.

For that matter, Salleh said, if fundamentals were taken into consideration, share prices would be within single-digit PE ratios (or at the most, less than 20) and not in the triple digit or close to triple digit ratio.

“This shows Malaysians have no notion of how to invest and what to invest in. At least ASB has a PE ratio of less than 15 - meaning you double your money in less than 15 years and not over 50-90 years,” he added.

The minister said media reports, especially those online, make it seem as if Malaysia is on the brink of an economic collapse, like what happened in the 1920s.

“That scenario cannot reconcile with the fact that investors are still coming to Malaysia to invest and every year we are seeing an increase in foreign investments.

“For that matter, the reports from the likes of World Economic Forum, World Bank, rating agencies like S&P, Moody’s and Fitch, etc, have all rated Malaysia favourably,” he said.

‘Malaysia is not sinking’

To further drive home his points, Salleh also cited Malaysia's new Sukuk bond offering of US$1.5 billion.

The minister pointed out that it received an overwhelming response yesterday despite weaker global conditions.

“The US$1.5 billion Sukuk was over-subscribed by 4.2 times when it received a subscription of US$6.3 billion.

“This shows that Malaysia’s long-term fundamentals remain appealing to investors. Compare this to Indonesia’s Sukuk offering last month where their US$2.5 billion Sukuk was 3.4 times over-subscribed.

“Then, if we look at the equity market, Malaysia’s capital market showed an increase of up to RM2.8 trillion in 2015, up 150 percent since 2009. The equity market also expanded by 69.6 percent to RM1.7 trillion, while the bond and Sukuk market grew 74.4 percent to RM1.1 trillion,” he added.

More importantly, Salleh said, the income for the bottom 40 percent households has increased by a compounded annual growth rate of 12 percent, even higher than the national average of eight percent.

He noted this means the government managed to lift 2.9 million people out of absolute poverty.

“We need to look at facts and not listen to rumours and negative propaganda. Malaysia is not sinking as the critics are saying.

“No doubt things are tough, that we cannot deny.

“But Malaysia is still faring better than many more advanced countries like those in Europe where the people do not even know what is going to happen when they wake up from sleep the next day,” he added.