Thursday, July 27, 2006

Behind ORI (Obligasi Ritel Indonesia)

ORI? Are you sure?

It started a few weeks ago when I read a post which promoted ORI (Obligasi Ritel Indonesia) in ILUNI-12 mailing list. And then, I read tabloid Kontan promoted ORI in last three weeks (CMIIW). If you don't understand the idea behind "obligasi" you may trapped in to government's gimmick "The Promising Investation"

I'm neither an economic expert nor student of economics. You have to re-check what I said. I've just lucky by being a son of a bank employee. This article was made to my friends who neither economic expert nor student of economics.

Obligasi means "debt". End of story.
When you buy an ORI certificate, means you just lend the government money.

Aha! You should started to understand why the ORI was backed up by Bill of Government's Letter of Debt (Undang-Undang Surat Utang Negara).

Then what? Government will owe me moneys. Isn't it cool?
Well.. the problem is do you believe your government? Do you believe our government can pay their debt to us? Where do you think the government can have money to pay the interest?

Imagine the worst case:
What if our government broke in the future? How they can repay the debt to obligasi holder? Well.. in my mind there are two ways

1. Adding a new debts to pay the old debts whether it is foreign debts or domestic debts (obligasi), or
2. ask PERURI (Percetakan Uang Republik Indonesia / Publisher of Republic Indonesia's Money) to print more money. I hope they will not choose this or they'll make the same mistake as Sukarno's government's mistake.

Well.. in the end, there is a proverb in my family: "If you want to lend someone an amount of money, you should be ready to lose the money".

PS: another links ( I don't write this post based on those links.. it was purely came from my brain)