For the past decade, there was a prevailing thinking that talented people cerated wealth and should be remunerated handsomely with fat bonuses and share options.
There was no distinction between the type of wealth and how they were created. In many cases, the wealth was created on top of a big asset bubble in properties and shares. The "talents" in the property and financial sector earned huge remuneration and bonuses.
When the asset bubble burst, these are the sectors that had to be bailed out. But, the fat bonuses are kept by the so-called "wealth creators".
The sad fact is that we are now going back into another asset bubble, with the low interest rate and bailout using taxpayer's funds. This will not be sustainable, and the world is likely to face another financial crisis - unless the asset bubbles can be reined in. But, that would be very difficult, given the low interest rate in the world today. In the meantime, the business leaders will continue to take the fat bonuses.
Tan Kin Lian
Here is an excellent article on the topic of talent. It's a bit old (2002) but every bit as relevant today.
ReplyDeletehttp://www.gladwell.com/2002/2002_07_22_a_talent.htm
If this situation is allowed to continue and repeat, it is likely it will lead to revolution war.
ReplyDeleteI want to deviate a bit. My advise for those who want to make big purchases is to do your own homework and stopp listening to the so-called experts. I see our media interviewing those so-called experts in property so frequently that prompt me to want to give them a piece of my mind. They are helping to create the next bubble. One will hear them saying that property prices is likely to drop but the other way round. Their outlook is always the same, why bother to listen then? This is because their fat bonus and income depends on property prices continuing to raise. Each time, when a crisis strike, property agents left the industry in thousands or tens of thousands. Why ? Because of the reason I just mentioned. So beware. The bubble in China and HK is big now and my guess is PM Wen is really thinking of what to do next.
ReplyDeleteLately, even the car agents joined in this kind of fanning. Before that, they said COE will rise because of CNY effect, ppl like to drive new cars during CNY. Now the CNY effect did not materialized, the song is changed to gahmen going to cut COE. So again, beware.
I had not been caught but property songs but by COE songs. With each lesson, I learnt something....
People should be rewardedfor their talents. Don't you wish that it would be the same if it were your turn to shine?
ReplyDeleteMeritocracy is the name of the game. If you want to be ordinary, so be it. Others prefer to be extraordinary if possible.
Why people want to earn more - simple, they would have more options or freedom in life to choose how to live their life instead of worrying over retirement or where to go for the next holiday.
If given a chance, some people would love to retire at 35, spend their time with their family, watch their children grow up (full time), travel the world anytime they want and write free books to distribute online, volunteer to help in other poverty stricken areas, drive the fanciest car, shop at a place where there are much less crowds and contribute more to society.
Imagine being able to do all this at age 35 instead of 65. That's why I feel it is justifiable for talented people to be paid high bonuses.
I have no issues paying $1 million dollars annual salary to somebody who is actually helping me.
ReplyDeleteI don't know how much we are paying the Education Minister. All I know is that my child still needs Mandarin tuition after returning from his school.
And countless Education Minister insists that our Mandarin education system is fine. And that the problem lies with all Singaporean students.
And suddenly, we have MM Lee commenting that our Mandarin education system needs revamping. And now, suddenly every official seems to agree.
Does this type of talent really command a $1 million dollar salary? If so, it's no wonder MM Lee still feels he cannot really retire.