Saturday, January 14, 2012

FISCA - Talks for 2012

For FISCA's planning in 2012, please indicate the talks that are of interest to you.

The best way to invest your savings

Sensible tips from Tan Kin Lian
I have often been asked, “What is the best way to invest my savings?” This question becomes more urgent during the past year, when investors have seen an uncertain global economic environment – high unemployment and economic slowdown in the advanced countries and large government debts and the prospect of government default on these debts.

In this article, I give 12 tips on investing in different types of investments - shares, government bonds, gold, property and structured products.  And I also give some advice on what you can do to be educated to make the right decision for your own good. Do not rely on other people who may give you the wrong advice - for their personal gain or through their own ignorance. You have to give your e-mail address to read this tips.

Friday, January 13, 2012

Property in Auckland, New Zealand

Hi Mr Tan,
I came across this article in NZ Herald. I'm not really sure what it is about, but maybe it will be useful for those people who are interested in the said NZ properties being advertised in Singapore.

Comment: according to the article, the apartment is being offered to Singapore investors, who are not aware about the problems that the New Zealand investors face with the developer.

User Guide for Alert Portal

You can try to access the Alert messages (these are test messages) using this link on your mobile browser, You can bookmark the browser and use it in the future. The browser screens look quite good, almost like an app. Being a browser, it can be used for most devices right away.

The elderly needs to use taxis

An elderly man called me. He said that elderly people need to use taxis to go to hospital. When he visited the hospital, he found that many elderly people from poor families took taxis to attend medical appointments at the hospital. They were too old or sick to use bus or train, or it might have been too far for them to walk. The increase in taxi fares and surcharges have hit the pockets of these elderly people significantly. This was a point that was overlooked by younger people.

Thursday, January 12, 2012

Survey - Alert Portal

Is is useful to have an Alert Portal to be used by many service providers / transport operators to provide alerts to the public and their customers? An example of an Alert Portal can be found her:

You can take part in this survey. Prizes will be given for participants who made useful suggestions on how to promote this portal.

Alert for breakdown in service

In recent weeks, we have experienced the following major breakdown in services:

  • Two major breakdown in the N-S line of SMRT train service
  • Breakdown in internet service under SingTel
  • Unauthorised ATM withdrawals from accounts of DBS bank customers
SMRT promptly introduced a system of giving updates through Twitter. This was a good initiative but the drawback was that few of their commuters had Twitter accounts. SingTel promised to provide updates through the website, but it is usually difficult to access information from a website.

I have developed an Alert system for transport operators and service providers to inform the public and their customers about breakdown in service and to give updates on the restoration of service. This can be viewed through a browser on the mobile phone. A separate app will be developed on the iPhone.

You can test the Alert system using your mobile or laptop by clicking on this link:

Please help me to pass the word around, so that many people become aware of this app and the operators will be keen to use it.

Confusion over the recommendation on government ministers' salaries

I am surprised to read this report about the "confusion" over the recommended pay for the government ministers.

Has our system become so complicated that a keenly anticipated event, like the release of the recommendation of the review committee, could have been mis-reported or mis-understood by the public? 

Pull wool over customers' eyes

Hi Mr. Tan,
I recall your blog post about not trusting financial advisors. Today, I found a publicly posted comment that reinforces your point. This was posted on Today Online, in response to MAS new customer assessment initiative:

"It is very difficult to do business when we are not allowed to pull wool over our customers' eyes. This integrity thing is highly expensive to implement, and is definitely not pro-business. If we can have gambling, I don't see why we can't have opaque sales terms for the investment business. After all, we are such a big business and so vital and central to any economy. We should be allowed to do whatever we want, as long as we deliver on growth. Sometimes, you have to cut down the forests to grow the cabbage, you know." - Jay Yip

Tax on the rich

I have high respect for Warren Buffet - not only for his skill in long term investing, but more importantly for his values and ethics. Warren Buffet said that the rich should pay more taxes and has pledged to donate this wealth to philanthropy (i.e. charity) on his death. He is among the few wealthy people that stood by Barack Obama in the difficult task of changing the governance of the US - a step that is not easy but has to be done. Read this article: 

Wednesday, January 11, 2012

Rechargeable torchlights

I received an order from a company for 10 rechargeable torchlights. I have stopped advertising the torchlights, so they must have been bought them before, and now wish to have additional items. Altough the torchlight has been in my stock for 3 years, they are still in good conditions. But, the supplier will not be able to meet new orders - so when my stock runs out, they will not be available. If you are interested, please your order now.

You can order here. Here is a description of the torchlight.

Meeting with Jack Bogle

FIRST POSTED: 21 May 2007 

I met with Jack Bogle during my visit to Vanguard. We have a very interesting discussion.

I presented to Mr Bogle a copy of an article written in The New Paper by Dr Money. He identified his three business heroes to be Jack Bogle, Warren Buffett and Bill Gates. I told Mr Bogle that he was listed as the first hero. He laughed.

Mr Bogle told me that he is now writing a speech to accept an honorary degree that is being conferred by a university. He will be talking about bond funds. Bonds now earn about 5% per annum, but a fund with a high expenses (comprising of sales charge, trading expenses and management fee) can take away as much as half of the yield, giving a net return of around 2% to 3%. He is furious about the poor return given to the end investors.

Mr Bogle told me that there is a requirement by Nasdaq that the terms of the traded product should be fair to the investors. He asked the questions (not his exact words), "Is it fair to give a product that takes away half of the yield? Where is the value to the investor? Does the professionals have a duty to give proper advice? "

I told Mr Bogle that a similar situation exists in Singapore, where structured products are being sold with high expense ratios (which are not disclosed). The end investors get a yield of 1% p.a. or lower after investing for 3 to 5 years.

Web and mobile developers - good response

I am getting good response to my latest ad for web and mobile advertisements - from Singapore citizens and permanent residents. I wonder if it is the start of the year, i.e. no loss of bonus for last year, or a sign of the economic slowdown. 

Wisdom on How to Live Life (Book 2)

From the author, Tommy Wong
Would you like to know:

(1) how to find out our interest and mission in life?
(2) why we should be careful with our thoughts?
(3) why we should not curse?
(4) what type of people is most dangerous?
(5) what is the real problem with attachments?
(6) what is the purpose of pain and suffering?
(7) how to choose a guru?
(8) what prevents us from having divine experiences?
(9) why meditation is important?

This book will be discussed by the Heartlands Book Club of Bukit Batok Public Library on Friday, 27 January 2012 from 5 to 7 pm. Further information can be found here.

The book can be ordered here.

Tommy Wong

Maternity leave for female employees

A young lady, recently married, told me that she had difficulty in getting a job. Employers are reluctant to recruit her as she is likely to have one or two babies and this will impose added cost to the employer to pay the salary during the two months of maternity leave. During the interview, this question was raised, and she did not get the job.

Sometime ago, another person complained to me that she was unfairly dismissed due to performance, when the real reason was that a baby was expected. She did not want to disclose the employer or take the matter to the Ministry.

I wonder if this is a common situation? I can understand that some employers, who are struggling to survive in business, does not want to have the added cost. Even the profitable companies want to avoid this cost, if they could, so that they can increase the bottom line profit. Perhaps, there is some hidden instructions to their HR department.

Please share your experience and views on this issue.

Tuesday, January 10, 2012

Collector shoe and shoe collector

A collector shoe is not a shoe collector. How humorous.

The real cost of GST

Published in Straits Times Online Forum on 10 January 2012

MY SINGAPOREAN friend who travels regularly to Hong Kong told me that he stopped buying many electrical products from Singapore as he can get them 20 per cent cheaper in the territory.
What accounts for this difference? Singapore imposes a goods and services tax (GST) of 7 per cent, but what about the difference of 13 per cent?
Although commercial rentals have been escalating in Singapore, they have always been high in Hong Kong.
I suspect that the real cost of GST is more than 7 per cent. There is the heavy compliance cost, especially for small businesses, of keeping accounting records of GST input and output, and submitting quarterly returns to the Inland Revenue Authority of Singapore.
There is also the multiplier effect of GST, as small businesses may not be able to get the full benefit of the refund from GST input. The higher cost of living faced by employees as a result of GST has to be reflected in their salaries, leading to a multiplier effect.
Businesses in Singapore also incur the cost and inefficiency of making and receiving most of their payments by cheques. There is also the high cost of complying with many regulations. Even the calculation of monthly Central Provident Fund contributions can be a headache, given the different rates of contribution for different employees.
Another friend, who has experience with manufacturing costs in many countries, told me that manufacturing in Singapore has become rather uncompetitive and can be sustained mainly by tax incentives and concessions given to some multinational companies. This is not a healthy trend for our long-term development.
I hope the Government will take urgent measures to address the underlying obstacles to our competitiveness and the causes behind high business costs.
Tan Kin Lian

Monday, January 09, 2012

Pay fine to URA

I have just received a parking fine for an expired parking coupon. The notice gave the URL to pay fine as

I went to this website, entered by car number and was shown the webpage below. Payment was quite straight forward. It was helpful of URA to direct me to the direct page with their URL.

If websites are designed properly, they can be helpful to the public. So, credit goes to URA for making it easy to pay a fine with a meaningful URL. I hope that other government agencies will apply their common sense to make life better for the public.

By the way, the last time that I paid a fine for URA was a few years ago. It was quite troublesome to find the right page to pay the fine. So, I suggested that they give the actual page with a ..../payfine. They have now implemented my suggestion, but they did not tell me about it. This is the bad culture in Singapore that has to change.

Online process of Ministry of Manpower

The Ministry of Manpower requires employers to use their online process to apply for work passes. Here is the FAQ on how to use the online process.

I hope that MOM realize that they are creating a lot of difficulty for employers. A better approach is for employers to submit their requests using a simpler online form, or even on physical forms. MOM should employ data entry staff to handle their complicated backend system, instead of expecting employers to fix their browser, scanners, etc.

MOM may save a few minutes of data entry time of their staff but imposes a large burden on employers. This is just one example of why business cost is so high in Singapore.

Finnish education system - focus on equality

My friend told me that he read an article to compare the difference in the goal of the education system in Finnland and of other countries. Finland decided to focus on "equality" rather than "excellence".

I strongly believe in the approach taken by Finnland. It is important for an education system in school to focus on "equality", i.e. to ensure that the students are educated in the right values and basic skills. The schools should NOT be a place to compete for excellence.

Just imagine what can be achieved with the approach taken in Finnland:

  • Our children will enjoy school and their child-hood
  • They will grow up with the right values, character and the basic skills to make a living
  • They will respect people in all occupations and will be willing to take the service sector jobs
  • There will be a smaller wage gap, which means that the cost of living will be lower for everyone
  • We will not have to pay high fees to doctors or lawyers.
This system will still allow people to excel, but the competition should in the workplace, AND NOT IN THE SCHOOLS.

Please share your views.

Japan last decades - a surprise!

Analysts have written about Japan's lost decades, after the collapse of the property and stock market bubbles in the early 1990s. The economy was supposed to be in the doldrums.

But some analysts are starting to realize that the so-called lost decades might have been a wrong description. Japan has been doing quite well, economically and socially, during these "lost decades". This is explained in the article here.

This is a good lesson not only for America and Europe, but for Singapore as well. It is possible to have the bursting of the bubbles, and for the underlying economy to do well. The benefit of the burst asset bubbles is that the country will focus on the productive sectors of the economy, and that the top earners are not skimming the economic system to the detriment of the ordinary people in the street. The cost of living can be kept affordable.

It is indeed an important lesson for Singapore - as we are truly suffering from the high cost of living and the high business cost.

The Government has taken an important first step to reduce the pay of the ministers. They should take a similar step to reduce the astronomical pay of the chief executives and top professionals (i.e. lawyers, doctors and accountants). We need a higher tax rate for super millionaires.

Sunday, January 08, 2012

Survey results - future elections in Singapore

30 people responded to the survey. Here are what they expect of the future elections in Singapore. The majority expect the President to be voted by the people. I personally think that this will be abolished and that the President will be elected by Parliament.

Pay for performance does not work

For the last 20 years, the concept of pay for performance has been the key driving force for the free market system. I have always been skeptical of this concept - as it encourages greed and manipulation. I am glad that there are now evidence to back up my gut instinct. See this report:

Financial Planning Tool

You can use this tool for your financial planning (provided by Tan Kin Lian).

Future election in Singapore

Do you expect the next President to be elected by the people, or will it be changed? Do you expect the GRC system to be discontinued? Take part in this survey.

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