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NOR MOHAMED YACKOP WAS once held in awe by currency traders from New York to Singapore as "Top Cat" - the biggest tiger in the global forex jungle. Then a top official at Bank Negara, Malaysia's central bank, Nor bet billions of dollars from Malaysia's reserves in the volatile markets, and earned hefty profits. But in 1992, Top Cat bet in favor of the British pound, and lost. The man on the other side of that bet - George Soros. Bank Negara wrote off more than $4 billion in losses that year and the next. Nor resigned, becoming an analyst and later a businessman. But last week, Top Cat was named an adviser to the central bank governor, back at the top of Bank Negara.

What's Malaysia up to? Another head-to-head contest with Soros? Not quite. Nor Mohamed Yackop's return to power is part of Malaysia's withdrawal from currency markets. He was a key adviser to the government in drawing up recently imposed capital controls, and his associates say he personally hatched the scheme to kill the Singapore bourse's foreign section - which until last week was a key market for trading Malaysian shares. An expert on banking and debt, Nor's return to the central bank not only signals his rehabilitation, says one Kuala Lumpur-based analyst, but also heralds the growing confidence of Prime Minister Mahathir Mohamad and his top policy makers that behind a firewall of capital controls and a fixed exchange rate, Malaysia can defy all odds and leapfrog to its next economic boom.

The return of Top Cat Nor and the naming as central bank governor of Ali Abul Hassan Sulaiman, who as Kuala Lumpur's head of economic planning oversaw the massive privatization and infrastructure boom that critics say fed overbuilding and cronyism, is being seen inside and outside Malaysia as part of a program of massive reflation and pump-priming to pull the country out of recession. It is a risky undertaking that flouts textbook economics and infuriates many international investors, but is being pushed aggressively inside the country through the nationalistic slogan Malaysia Boleh - "Malaysia Can." Bank Negara certainly has not lost any time. Since his appointment, Ali has told banks to reinstate withdrawn credit lines and boost year-end loan growth to 8% - double what current lending patterns would indicate - while cutting the maximum margin they can charge over the quoted base lending rates, all in an effort to keep money flowing to cash-starved businesses. With the additional measures, Ali said "prospects for early recovery will be more certain."

Really? U.S. investment bank Salomon Smith Barney thinks so. Capital controls, a fixed exchange rate and easier monetary policies "should improve government's ability to bring forward the timing of economic recovery," it said in a report issued last week. "The measures will help reduce corporate Malaysia's collective balance sheet, which means lower non-performing loans and greater success of corporate debt restructuring." But Salomon would say so. It was hired by Kuala Lumpur for a hefty fee to talk up the prospects for Malaysia's economic recovery and raise new money for the battered banking sector.