Tan Kin Lian's Blog

Give a prompt reply

2012-01-26T15:01:00.003+08:00

I make it a point to give a prompt reply to any question that is addressed to me personally, i.e. not part of a spam mail.

I received an email on behalf of a project group of students in SMU asking for explanation about the dual currency investment. I gave a reply immediately to two questions and also enclose my FAQ on this subject. The recipient must have been surprised at the prompt reply. She replied, "Thank you very much".

I reply with what I know. Even if I do not have the ready answer, it is quite easy for me to search for it in my website or in the Internet, using Google. If I do not have the answer to some questions, I will still give a reply to the questions that I know. A partial reply is better than no reply.

I want to encourage people to give a prompt reply, instead of ignoring an e-mail that is sent personally. My comment also apply to our ministers. Although they are busy, they do have an army of assistants who can give a proper reply, not just an insincere acknowledgement or worse - ignore it entirely! Our leaders need to set a good example in courtesy and the proper behavior.

Pawn and money lending shops

2012-01-26T14:44:00.003+08:00

I was at Ang Mo Kio Central looking for a photocopy shop. I was surprised to see so many pawn shops and money lending shops in the vicinity of AMK Hub. It seemed that every other shop is in this trade. Have we became so obsessed with money?

Dilbert and pay of political leaders

2012-01-26T11:20:00.001+08:00

http://dilbert.com/strips/comic/1989-11-20/

Exempt safe, indexed ETFs from new rules

2012-01-26T09:47:00.002+08:00

Published in Straits Times Forum, 26 January 2012

NEW regulations require consumers to get appropriate investment advice before investing in financial products that carry higher risks, such as structured products and investment funds.

However, they have the unintended consequence of preventing the online purchase of certain indexed exchange traded funds (ETFs) that are suitable for long-term investment. It is ironic that investors are allowed to make online purchase of individual stocks but are disallowed from investing in ETFs that allow them to diversify their risk over a number of blue chip companies that comprise the stock market index.

I recognise that some ETFs are invested in financial derivatives or are leveraged and are not suitable for investors who are not aware or not properly advised about the risks. But these risks do not apply to non-leveraged ETFs invested directly in the component shares of the stock market index. A few ETFs quoted in the Singapore Exchange meet this criterion and are safer than investing in individual stocks.

I suggest that the Monetary Authority of Singapore exempt the non-leveraged, indexed ETFs from the need to receive appropriate advice.

Tan Kin Lian
President
Financial Services Consumer Association

Investigation for corrupt practices

2012-01-26T08:59:00.001+08:00

I wonder if Singaporeans are over-reacting to the corruption charges against the former SCDF and CNB chiefs. We have not got the details about the misdeeds that they are being investigated.

I read that this may involve a woman executive of an IT firm. If this is the main factor, I would not consider it to be a corrupt practice that merit the level of attention. I have read of similar cases involving top executives in America and even a former President of the United States. In those cases, there were dealt with by the media and public opinion and not a corruption agency.

Let us wait for the actual facts to surface, and not speculated on this matter - which might be unfair to the affected parties. This is one aspect of the culture in Singapore that should be changed.

Reduce the compliance cost of GST

2012-01-25T17:39:00.002+08:00

Singapore has become more costly than Hong Kong for many products that are manufactured in China and other countries. GST adds 7% to the cost of buying a product in Singapore (and Hong Kong has no GST) but imposes an additional cost due to compliance. Here is a way to reduce the compliance cost and make Singapore businesses more competitive.
http://tankinlian.com/admin/file.aspx?id=617

Tax hikes

2012-01-25T17:02:00.000+08:00

We need tax hikes to solve the deficit problems in the advanced countries. The governments have to pay unemployment and other benefits, to avoid extreme hardship on those who lose their jobs due to factors beyond their control. These payments have to be funded by those who can afford, so the taxes have to be increased. While it is necessary for governments to control their expenditures, it is also necessary to give the governments adequate resources to do their work.
http://www.cnbc.com//id/46127466

Failure of deregulation

2012-01-25T06:53:00.000+08:00

The story of Freddie Mac and Fannie Mae shows the failure of deregulation. Under a deregulated environment, the sub-prime mortgages were created recklessly, and this caused the sound institutions to be sucked into the mess. http://money.cnn.com/2012/01/24/news/economy/freddie_mac/index.htm?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29

We are experiencing our own problems of deregulation in Singapore. It is time to recognize the difference between good and bad regulation. Unfortunately, our regulators does not have this expertise, as they are brought up in a sheltered environment. The latest measure to protect consumers against bad financial products is an example of a bad regulation - as it does not address the real issue and make matters worse.

Misleading advertisements

2012-01-25T06:44:00.000+08:00

The consumer watchdog in Australia is taken legal action against a budget airline for misleading advertisements about their fares.
http://www.todayonline.com/World/Worldinbrief/EDC120125-0000040/Australias-consumer-watchdog-sues-AirAsia-over-ads

Misleading advertisements of a worse nature, are rampant in Singapore. We need to address this issue as well.

Charges on Medisave withdrawal

2012-01-25T06:42:00.000+08:00

Here is an example of wasteful and unnecessary charges being added to the high cost of living. http://www.todayonline.com/Voices/EDC120125-0000006/Extra-charges-on-Medisave-withdrawals-should-be-waived

Mechanized car parks

2012-01-25T06:38:00.000+08:00

Read this letter: http://www.todayonline.com/Voices/EDC120125-0000034/Park-funds-in-the-right-car-park?

Mr. Paul Chan argues that it is more convenient and cheaper to park in the open car park. However, he did not take into account the cost of the land that is used in this way. If the land is priced at the market rate, the cost of the open car park will be several times of the mechanized car park.

It is costly to own a car and to find the parking space for a car. This is inevitable. What is needed is better public transport, feeder services and cheaper taxis. Buying a car is not the solution. Do not expect cheap car park space.

Driving children to school

2012-01-25T06:34:00.000+08:00

Here is another bad example of the lifestyle in Singapore.
http://www.todayonline.com/Voices/EDC120125-0000056/Parents-should-be-discouraged-from-driving-children-to-school

Parents want to send their children to "good schools" and that require long travelling distances. The public transport is bad, so parents have to drive their children to school - wasting two hours of time and adding congestion on the road.

If we do not recognize the inefficiency in our system, our economic performance and quality of life must surely drop.

The world needs 600 million new jobs

2012-01-25T06:28:00.001+08:00

http://www.todayonline.com/World/EDC120125-0000054/World-needs-600-million-new-jobs-in-next-decade

The world needs 600 million new jobs over the next decade. How can these jobs be created? Here are my views on this global challenge:

Global competition results in income disparity
Stagnant wage for most people destroy their spending power for products and services
The reduced spending destroys economic growth and jobs

While globalization has been destroying demand and jobs for over two decades, its impact was temporarily hidden by the real estate and stock market bubbles, which created non-productive jobs in the financial sector to replace the destroyed jobs, until the bursting of these bubbles.

To create new jobs, the following steps have to be taken:

Reduce the wage disparity by introducing minimum wage and high taxes for extremely high incomes
Reduce the working hours, so that more people can be employed to share the available work
Introduce measures to restrict outsourcing and the inflow of foreign labor

I am referring to the global situation and not specifically to Singapore. However, Singapore will also face the same impacts. While Singapore now benefits from globalization, it is at the expense of other countries, and is not good for the long term growth of the global economy.

AFTER NOTE:

Even the Republican candidates are willing to raise the minimum wage, as they recognize the realities of the bad economic situation. http://management.fortune.cnn.com/2012/01/24/a-new-day-for-the-minimum-wage/?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29

Treat indexed ETF differently

2012-01-24T09:34:00.001+08:00

I have written a letter to the Straits Times in my capacity as President of the FISCA (Financial Services Consumer Association, www.fisca,sg) to ask MAS to treat the indexed ETF differently (from other ETFs based on derivatives) and allow consumers to make online purchase without getting investment advice. I hope that they publish the letter. If not, I will publish the letter here here on Saturday.

US taxpayers bear the loss

2012-01-24T08:38:00.000+08:00

Read this story about the burden that will be shouldered by the US tax payers over the losses that are suffered by Fannie Mae and Freddie Mac: http://www.cnbc.com//id/46106075

Here is the background to this state of affairs:

The real estate market in the US was a bubble for one or two decades before it finally burst in 2008
During this period, large profits were made by developers, real estate agents, mortgage bankers and other people connected with the trade
The home owners were enticed to pay high and unsustainable prices for the property
The purchases were funded by mortgage banks and insured with Fannie Mae, Freddie Mac and other insurers
Bad financial products such as sub-prime mortgages and collateralized debt obligations (CDOs) were created to fund these unsustainable prices

With the bursting of the bubble, the drop in real estate prices have to be shouldered by the home owners, the mortgage banks and the insurance agencies. A significant part of the losses are now taken over by the taxpayers.

A lesson to be learned - if the real estate prices are allowed to appreciate to an unsustainable level, it will have to burst one day and bring big damages to the economy and the people. Several countries have gone through this phase. Other countries, including Singapore, will have to follow. There is no escape from the inevitable.

Be an Entrepreneur

2012-01-24T08:20:00.003+08:00

Here is a way for someone to start a new business as an entrepreneur and achieve a greater chance of success and without the need for a large capital. You only need to have an idea, the passion and the willingness to slog it out.

Read this
http://tankinlian.com/admin/file.aspx?id=616

PM Lee speech for Lunar New Year

2012-01-23T15:20:00.002+08:00

PM Lee encourages Singaporeans to have more babies. The comments from netizens are overwhelming negative. It is so sad that Singapore has now reached this negative state. PM Lee has a difficult time to reverse the situation. It has gone too far down the road.
http://sg.news.yahoo.com/pm-lee-encourages-s%E2%80%99poreans-to-have-more-%E2%80%98dragon-babies%E2%80%99-this-year.html

2012-01-23T10:49:00.002+08:00

This is an interesting example of a democratic political process that works. Mitt Romney, the leading Republican candidate for the US Presidential Election has a high income background, as the former head of a management consulting firm. He lost the South Carolina primary election to Newt Gingrich due to his unwillingness to show his tax returns. He is now putting it right to tell the American people about his financial affairs.

http://www.todayonline.com/World/EDC120123-0000019/Stung-by-defeat,-Romney-ready-to-right-tax-mistake

This lesson is also applicable in Singapore.

Salaries of ministers

2012-01-23T10:39:00.000+08:00

I share my views about salaries for ministers. I find the basic salary to be acceptable, but the concept of a high rate of bonus based on performance is bad. Many Singaporeans are not aware that the concept of "pay for performance" has its negative impacts, especially in the public sector, and how it has developed a bad culture in Singapore.
http://tankinlian.com/admin/file.aspx?id=615

Invest in gold bar

2012-01-23T09:29:00.000+08:00

I share this story of how a retired school teacher was almost cheated of a large sum of money by investing in gold bars at an inflated price. This type of scam is being applied to other products, such as industrial oil.

For FISCA members only:
http://easyapps.sg/assn/Org/Information.aspx?id=5

For non-members (you have to provide your email address to retrieve the article)
http://tankinlian.com/admin/file.aspx?id=614&PK=bb278df596b1102f8459bccabf61a61c

FISCA articles

2012-01-22T09:57:00.001+08:00

There are several articles reserved for FISCA members only. Some articles can be read by the public. These articles are shown here:
http://easyapps.sg/assn/Org/Information.aspx?id=5

Members can click on the "Login" tab and enter the email address and password to read the articles that are reserved for members.

Invest in overseas properties

2012-01-22T09:49:00.005+08:00

What are the pitfalls to avoid? Is there a safe way to invest in overseas properties to enjoy the capital appreciation when the economy develops? Read this article (for FISCA members only): http://easyapps.sg/assn/Org/Information.aspx?id=5

Non-members of FISCA can read the article here (after submitting your email address).

To all readers of my blog

2012-01-21T18:46:00.001+08:00

Law to combat online piracy

2012-01-20T15:56:00.001+08:00

There are two proposals to pass a law against online piracy in the USA. They are known by the acronym SOPA and PIPA. Someone asked me for my views on these proposed legislation - especially if a similar legislation is being considered in Singapore.

I prefer to let this matter be handled by the experts. I understand that Google has taken a stand against certain key provision of the proposed law, such as blocking certain websites. So, I have no comments.

If anyone wish to express a view about this legislation, and if it is good or bad for consumers in Singapore, they can post their comments here.

Cost of mobile data

2012-01-19T15:34:00.001+08:00

I bought a prepaid data card in Jakarta for $15. It allowed me to download 1G of data over 30 days. As I stay for 3 days, my cost is $5 a day. On my return to Jakarta 40 days later, I found that the data card could still be used, i.e. the 30 day limit did not apply. So, the data card of $15 could be used for 6 days or $2.50 a day.

The mobile operators in Singapore charge $14 or $20 for each day of "roaming" data access in Jakarta. Their charges are too high.

I have found that it is much cheaper to buy a prepaid data plan at the destination, rather than use the roaming service. I hope that the mobile operators review their charges to be competitive.

ST Forum - Develop a complementary system

2012-01-19T14:52:00.005+08:00

An edited version of this letter was published in Straits Times on 19 January 2012

The two train breakdowns in December was a surprise to Singaporeans, because they were totally unexpected, not only to commuters but to the train operator.

My friend had just experienced a train delay of one hour during his holiday in the UK. He said that train breakdowns and delays in the advanced countries are quite common and are taken in their stride.

While we can do our best in carrying out proper maintenance of the train system, we have to accept the fact that there will be more frequent disruption in services in the future due to the age of the system and to the over-load on the train system.

I urge the Land Transport Authority to take urgent steps to develop a complementary service to reduce the over-reliance on the current train service. A possible approach is:

Allow express bus services to be operated between the bus interchanges which are already located next to the train stations
These express services bring passengers between the bus interchanges and do not pick up passengers along the route
They will increase the capacity during the peak hours and reduce the over-crowding on the trains
It will be easy to add more buses quickly in the event of a train breakdown
It allows commuters to become familiar with an alternative service
The express bus services can be operated by the train operators or by private bus companies.

Tan Kin Lian

ST Online Forum - Encourage car pooling and taxi sharing

2012-01-19T14:30:00.003+08:00

Published in ST Online Forum on 18 January 2012

To tackle the congestion on our roads, the Ministry of Transport is developing a new expressway and adding more lanes, flyovers and underpasses to existing roads.

Infrastructure development takes years to be completed and, in the meantime, the construction work aggravates the current situation.

There is another option to deal with this situation - encourage car pooling, car sharing and taxi sharing. If two people share a taxi or pool in a car, there will be less need for some many vehicles on our road.

When Mr. Mah Bow Tan was the minister in charge of transport, he actively promoted these concepts. At that time, the ministry clarified that car owners were allowed to collect a payment for car pooling as defrayal of expenses, and the insurance cover would not be compromised. His ministry also actively promoted taxi sharing. I am not sure if the current minister holds these views.

With the widespread use of smart phones with GPS location services, it is now possible to use technology to match people who are interested to share a taxi or to car pool.

It will be useful for the minister to re-confirm his stand on these issues, so that car pooling and taxi sharing can be actively promoted as another option to solve our problem of traffic congestion.

Tan Kin Lian

Electronic pickpocket

2012-01-17T14:08:00.004+08:00

Be careful of this type of identity theft.
http://www.wreg.com/videobeta/?watchId=8ba6f8fc-90a2-4711-90ea-1884ec348310

Are equity linked investments good for consumers?

2012-01-17T13:36:00.000+08:00

Find out what are these investments, how they work and if they are good for consumers. This is available at the FISCA website, www.fisca.sg, and available only to members after they have logged in. Click here.

Salaries of Ministers

2012-01-17T11:37:00.002+08:00

I read the news report about the basic salaries of the different levels of political office, from ministers to parliament secretaries. They are quite modest and acceptable to me, and perhaps to most Singaporeans.

It is the high rate of bonus that brings the salaries to a high level. This bonus is supposed to be "pay for performance". I do not like this concept. At a senior level, office holders (in the public or private sectors) should not be motivated by greed. They should do their best out of honour and the privilege to serve the people.

When this principle is realized, we will have a better society, which can give a better life for all. When political leaders are motivated by greed or personal wealth, we have a bad society. There is still time to change for the better. Remove the performance based bonus!

Encourage travelling by bus

2012-01-17T09:44:00.000+08:00

I wish to develop a mobile app to encourage commuters to travel by bus. While there are many apps already available, I wish to develop a new app that is easier to use. I need the following data and will appreciate advice on how they can be retrieved for free or at a modest cost:

GPS location and number of all bus stops in Singapore
Numbers of the bus services stopping at each bus stop
Arrival time of the next bus for each service and bus stop (this need access to the servers of the bus operators)

If you have any information on the above, please write to kinlian@tankinlian.com. Thank you.

A positive and negative approach

2012-01-17T08:25:00.000+08:00

Whenever a suggestion is brought up to make a change, there is a tendency for people to point out what is wrong, and what they do not agree. In many cases, the negative views are not based on actual experience, but is on hypothetical reasoning. This is a negative mindset but is quite common in Singapore.

A positive mindset looks at what is right about the suggestion and a willingness to give it a try. If the actual experience shows some negative consequences, they can be fixed at that time. This is what makes for change and entrepreneurship.

For Singapore to be willing to change and to be entrepreneurial, we need a positive mindset. It is a big challenge to change from a negative mindset, which is ingrained in our culture and education system (remember the term "kiasu"?). But, the process of change starts with the realization of our present situation and a desire to work towards a better situation.

Share your views.

SGX and China Sky

2012-01-17T08:01:00.000+08:00

SGX has withdrawn its legal suit against China Sky and is now negotiated a settlement out of court. See this report: http://www.todayonline.com/Business/EDC120117-0000058/SGX-drops-suit-against-China-Sky
I hope that the terms of the settlement be publicized to be a reference for future cases of this type.

Many areas of the law in Singapore are not clear, due to a small number of cases that are tried in court. If more cases are tried and decided in court, the judge will be able to give a view on what is right, what is wrong, what is reasonable, what is unreasonable. This will help to strengthen the understanding of values in our society.

The lack of clarity instill fear in Singaporeans. Recently, I met a young man, who graduated from university, that was so fearful of using a non-artistic image in the website for fear of infringing the copyright. It was a general image that could not be identified to an owner. He heard that someone had gone to jail for infringing the copyright, and he did not want to take this risk.

I find many Singaporeans to be too fearful and will not take any risk if there is some unclarity or uncertainty. This is why entrepreneurs are so rare in Singapore. And it can be traced to our climate of fear.

Promote car pooling and taxi sharing

2012-01-17T07:26:00.000+08:00

One option to tackle the congestion on the road is to promote car pooling and taxi sharing. With smart phones and GPS location services, it is now possible to identify people who wish to car pool or share a taxi. For car pooling, the Government should clarify that the collection of a fee to defray the expenses is not considered as operating a taxi service. This will encourage more people to car pool. Do you agree?

Today Paper: The priorities for SMRT

2012-01-16T21:48:00.004+08:00

Letter from Tan Kin Lian in Today Paper

In the search for its new chief executive, I urge SMRT Corporation's board of directors to find a person who understands and is able to realise these immediate and long-term goals:

- Ensure the smooth running of its current operations

- Use technology to improve communication with commuters in the stations and outside

- Improve the current system of receiving and resolving customer feedback and issues

- Achieve a balance between its commercial goals and providing a comfortable, affordable public transport service

- Develop a complementary system to its rail operations and reduce the impact caused by any unexpected failure

The first three priorities can be implemented immediately, while the last two may take longer, but their importance has to be recognised.

On the matter of a complementary system, SMRT should run express bus services between the bus interchanges next to its train stations. These buses should not pick up passengers enroute.

This could complement the trains, especially during peak hours, allowing commuters to be familiar with this service. More buses could be deployed during emergencies and train breakdowns.

I give my best wishes to the board and the new CEO in the challenging task of remoulding SMRT to reattain the service standards that Singaporeans had long been proud of until now.

Tan Kin Lian

Proposed security measure for ATM withdrawal

2012-01-16T08:46:00.000+08:00

A few people have given their views about the potential drawbacks of this proposal. http://tankinlian.blogspot.com/2012/01/suggestion-to-enhance-security-for-atm.html

I wish to ask for some views on the positive aspects of this proposal, compared to existing systems of authentication or non-authentication (apart from the 6 digit PIN).

In making an internet banking transfer or credit card payment, I receive a PIN through SMS and has to enter the PIN within a short time to authenticate the transaction. I find this method, which is commonly used, to be more troublesome. I would prefer to use my mobile phone to call a specific number to make the authentication, i.e. a pro-active authentication, rather than a reactive one.

What are your views?

Parking spaces, congestion and taxi service

2012-01-16T08:12:00.001+08:00

Do we have too many or too few parking spaces in the CBD? There is disagreement on this issue. Read this article. http://www.todayonline.com/Commentary/EDC120116-0000003/The-CBD-has-too-many-parking-spaces

Two points are not in dispute:

Our roads are too crowded in the CBD
The taxi service is poor, i.e. costly, unavailable at busy times

These points are connected. If we have an efficient and affordable taxi service or some form of local transport, there is no need for so many people to drive into the CBD, and no need for more parking spaces.

What is a local transport service? It is my description of a service involving small buses and taxis that ply within a town or the CBD. As they do not travel outside of their zone of operation, the licensing requirement can be relaxed. They can pay a daily fee and be exempted from ERP and other charges.

If we tackle the problem of local transport. we will have the framework to solve the larger issue of transport in Singapore. I hope that the Ministry of Transport will seriously consider this suggestion - to improve local transport.

A suggestion to enhance security for ATM withdrawal

2012-01-15T13:48:00.001+08:00

DBS Bank experienced unauthorized withdrawal from their customer accounts through the ATM machines. They are now looking for a way to enhance the security measures.

I wish to suggest the following method, which does not involve any change to the current magnetic strip card. I suggest that the ATM machine should ask the customer to use his registered mobile phone to dial a certain number of the bank. The bank will retrieve the mobile number, using caller ID, to "activate" the withdrawal.

For the crook to take out money, the crook needs to have the mobile phone as well. This will be a hindrance to the crook.

Currently, DBS sends a SMS to the customer and ask the customer to enter a PIN from the SMS to confirm the account. My suggested method is more practical and less costly (i.e. does not use SMS) and can also be used for internet banking.

Do you agree with my approach? Can you see any flaws or weakness?

Security of ATM machines

2012-01-15T11:44:00.000+08:00

DBS Bank suffered several unauthorized withdrawals from their customer accounts. They are now introducing additional measures to enhance security.

It is important to have adequate security, but we have to distinguish between good and bad security measures. A good security measure is effective and does not increase the cost significantly or make it inconvenient for customers. A bad measure does the opposite.

The culture in Singapore is "security at all cost" to plan for "the worst case scenario". It is the culture in Singapore to over-react and take excessive measures to "enhance security". This is called our "kiasu" and "kiasi" syndromes. I have seen many examples of bad measures that are costly, and ineffective. The trouble is - all of these measures keep on adding up, and making life quite complicated and stressful.

If you were in charge of implementing the good measures to enhance the security of ATM machines in a bank, what would you do?

Investing in a franchise

2012-01-15T11:31:00.001+08:00

Hi Mr Tan,
I was wondering if you have heard of the Snap-Print franchise. I am a greenhorn to the world of business and am considering to start my first investment with Snap-Print to learn the ropes of starting a business.

Snap-Print is a printing company that does prints on apparels, digital and offset and large format prints like banners, backdrops, etc. They are offering a franchise for small home business start ups. This is how the franchise works. I will register a company with ARCA. Next, I will source the deals on my own and quote my own price based on negotiations. Snap-Print will offer me a partner price for the printing. The amount I quote to the client minus the partner price given by Snap-Print would be my profit.

Snap-Print is offering the franchise for 9k. They are providing me some support like the relevant product training, sales and marketing techniques and printing business operations. Do you think this opportunity is good for someone like me who is new to business and want to start learning business by doing?

REPLY BY TAN KIN LIAN
I do not know about the business model and the prospects for Snap-Print or the reliability of the franchiser.

I can only give a few words of general advice, before you spend $9,000 in paying the franchise fee.

1. Do not spend money on any business idea that is not clear to you.
2. Some people make money from the franchisee and give a business model that may not work (I am not referring to Snap-Print).
3. It is not easy to start a business - as you have to take care of many issues, such as marketing, finances, recruiting people, collecting debts. Be aware of all these challenges, before you plunge into a business.
4. It is best to help a friend to run an existing business, so that you are aware of the business issues, before you start a business on your own. It is better to be prepared.
5. I have seen many people lost a lot of money on franchises, not only the franchise fee but the follow-on investments. So, do your study carefully first.

How investors lost money on dual currency investments

2012-01-15T09:30:00.002+08:00

Many risk averse investors were not aware that they were taking much higher risk in investing in dual currency investments - compared to shares and foreign currencies - and were not given the higher yield for the risk. Here are three real stories of how people fared in this type of investment.

This article is reserved for FISCA members only. You can view the article at the Information tab of the FISCA website. There are articles in the website that can be viewed by the public, i.e. non-members.

The FISCA website can be accessed directly at www.fisca.sg. Click on the tabs to access the different functions in the website.

FISCA Website

2012-01-15T08:27:00.000+08:00

The Financial Services Consumer Association (FISCA) has recruited a few additional volunteers. They will help to provide useful information on the FISCA website. I will also share regular stories about investment scams and bad products, and how people have lost money by investing in bad products on the wrong advice given by the intermediaries (who sold the product).

These stories will be restricted only to FISCA members. The public can see the title and a short explanation, but cannot view the entire article. I encourage FISCA members to visit the website regularly and view the articles. We will automate a weekly e-mail alert.

www.fisca.sg

Voice mail is not useful

2012-01-15T08:19:00.004+08:00

Hi Mr. Tan,
I wish to highlight the redundant Voicemail service in mobile phone service. More importantly, it is a waste of the caller's $$$.

Currently, when I call another person's mobile phone and if he does not pick up the call, I will be directed to the Voicemail service within 10s (approximately. Maybe less than that). When this happens, the call will start to 'eat' into my mobile phone service's talk time.

With SMS and whatsapp, this Voicemail service is redundant. I feel that it is put in to 'eat' into callers' talk time.

Subscribers can opt out of this service. However, many are unaware. Even if they are, many don't care because it 'eats' into the caller's talk time, not the subscribers'. If true, this is an unethical practice by mobile service providers to boost profits.

For your views and highlight in your blog.
Mr. Lee

REPLY BY TAN KIN LIAN
I agree with you. I had the same experience. When I get into the caller voicemail, I stopped the call immediately.

As the receiver, I find the voicemail to be impractical to use. So, I opt out of the service.As there is caller ID, it is easy to return a call to those numbers that I recognize.

FISCA - Talks for 2012

2012-01-14T20:54:00.002+08:00

For FISCA's planning in 2012, please indicate the talks that are of interest to you.
http://www.surveymonkey.com/s/TKVXB8K

The best way to invest your savings

2012-01-14T20:35:00.001+08:00

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.

http://tankinlian.com/admin/file.aspx?id=612&PK=8a52fc1d8ffb102f84debed2e3f9351e. You have to give your e-mail address to read this tips.

Property in Auckland, New Zealand

2012-01-13T14:29:00.000+08:00

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.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10778350

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

2012-01-13T08:22:00.003+08:00

http://tankinlian.com/admin/file.aspx?id=610

You can try to access the Alert messages (these are test messages) using this link on your mobile browser, www.easyapps.sg/alert/messages.aspx. 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

2012-01-13T05:39:00.000+08:00

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.

Survey - Alert Portal

2012-01-12T20:02:00.000+08:00

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: http://www.easyapps.sg/alert/Messages.aspx

You can take part in this survey. Prizes will be given for participants who made useful suggestions on how to promote this portal. http://www.surveymonkey.com/s/9KYWJ8H

Alert for breakdown in service

2012-01-12T12:12:00.004+08:00

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: http://www.easyapps.sg/alert/Messages.aspx.

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

2012-01-12T11:55:00.000+08:00

I am surprised to read this report about the "confusion" over the recommended pay for the government ministers. http://www.todayonline.com/Singapore/EDC120112-0000108/Ministerial-pay-review-report-misunderstood--Committee

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

2012-01-12T11:42:00.001+08:00

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

2012-01-12T08:05:00.000+08:00

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: http://www.cnbc.com//id/45961945

Rechargeable torchlights

2012-01-11T17:19:00.001+08:00

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

2012-01-11T17:00:00.000+08:00

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

2012-01-11T13:48:00.000+08:00

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)

2012-01-11T12:36:00.000+08:00

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

2012-01-11T10:04:00.000+08:00

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.

Collector shoe and shoe collector

2012-01-10T10:44:00.002+08:00

A collector shoe is not a shoe collector. How humorous.
http://singaporedesk.blogspot.com/2012/01/another-day-another-dollar.html

The real cost of GST

2012-01-10T08:51:00.004+08:00

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

Pay fine to URA

2012-01-09T13:18:00.001+08:00

I have just received a parking fine for an expired parking coupon. The notice gave the URL to pay fine as www.ura.gov.sg/pf.

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

2012-01-09T08:49:00.000+08:00

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. http://www.mom.gov.sg/MOMDoc/ESubmission_FAQ.pdf

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

2012-01-09T08:18:00.002+08:00

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!

2012-01-09T07:48:00.000+08:00

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. http://www.todayonline.com/Commentary/EDC120109-0000010/The-myth-of-Japans-failure

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.

Survey results - future elections in Singapore

2012-01-08T23:26:00.003+08:00

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.
http://tankinlian.com/admin/file.aspx?id=609

Pay for performance does not work

2012-01-08T12:08:00.001+08:00

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:
http://www.todayonline.com/Commentary/EDC120106-0000003/Stop-tying-pay-to-performance

Financial Planning Tool

2012-01-08T08:46:00.002+08:00

You can use this tool for your financial planning (provided by Tan Kin Lian). http://tankinlian.com/admin/file.aspx?id=570

Future election in Singapore

2012-01-08T08:44:00.000+08:00

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. http://www.surveymonkey.com/s/SJTDRTN

Cut in Ministers' Salaries

2012-01-07T15:07:00.003+08:00

The Ministers have accepted a 36% cut in their salaries. The cut was higher than what most Singaporeans had expected, based on the survey carried out by me earlier. 76% had expected no cut or a cut of less than 25%. The results of the survey can be found here.

We have to acknowledge that the Government had taken an important first step to address the concerns of the people and that the review committee had done a good job in drawing a fine balance between the difficult conflicting requirements. While the revised salaries are still high by international standards, they are not high by Singapore standards, where chief executives, lawyers and doctors are earning much more.

Our challenge is to reduce the cost of living for the ordinary citizens. Let us focus on this important task, and do not be too distracted by the salaries of our political leaders. Let us give them the support to address the key challenge.

High business cost in Singapore

2012-01-07T14:58:00.000+08:00

I read that Nokia has decided to move its Asian headquarters from Singapore to Beijing, citing high operating cost and other reasons. Google choose Kuala Lumpur to be their regional base, instead of Singapore.

A friend, who was in charge of planning for a large multi-national company with wafer fab operations in various countries in Asia told me that it is too costly to manufacture in Singapore. He said that a factory in Singapore that requires spare parts pay 2 to 3 times of the price that a Taiwan factory pays to their local suppliers. Someone, the Singapore suppliers charge too much, even for spare parts that are imported from overseas.

A few people have told me that they can buy electronic products from Hong Kong at a price 20% lower than Singapore.

These are all signs of Singapore becoming too costly for business. I hope that our Ministry of Trade and Industry and Ministry of Finance are aware of these indicators. They are quite worrying.

The President's Salary

2012-01-07T14:51:00.000+08:00

The review committee under Gerard Ee has recommended that the salary of the President of Singapore be cut by 51% and the revised salary is about $1.5 million.

Several readers of my blog have commented that this cut matches the 50% that I promised to donate to charity during the campaign for the Presidential election. I wish to make this clarification.

I had expected the salary to be cut by 50% and my promise to donate 50% is on the reduced salary. This meant that I would be happy with a net salary of around $750,000 (which is still a lot of money). There is still the bonus that will be added to bring it up closer to $1 million.

Anyway, all of this is now water down the bridge .....

Interesting political development in Myanmar

2012-01-06T16:48:00.003+08:00

For over two decades, Myanmar was considered to be an undemocratic country ruled by a dictatorial and corrupt military junta. The popular democratic leader, Aung San Suu Kyi, was placed under house arrest. Myanmar was shunned by the neighbouring countries and the democratic world.

During this time, the leader of Myanmar was Senior General Than Shwe, who was the supreme commander of the armed forces.

The political situation changed significantly in Myanmar since March 2011, when President Thein Sein came into power. My friend from Myanmar told me that many people were surprised that he implemented reforms and introduced democracy. Aung San Suu Kyi is now allowed to contest the next election. Furthermore, President Thein Sein and several members of his cabinet was regarded by the people to be free of corruption, and genuinely concerned about taking positive steps to improve the lives of the people.

What was more surprising, and is now being felt and realized by many people in Myanmar, was that the steps towards reform and democratic changes were planned by the former leader, Than Shwe. When he was in power, many people feared and perhaps hated him. It seemed that he might have a good leader after all.

Than Shwe supported Thein Sein's election as the President of Myanmar. In turn, Thein Sein has now earned the respect of the people of Myanmar and the democratic world through the positive leadership that he has provided.

This is the view of an insider of Myanmar. It development was a surprise to me, as I had not been following Myanmar closely. I wonder if other people, who knows the situation in Myanmar, can share their perspective?

FROM WIKIPEDIA
Senior General Than Shwe (born 3 February 1933) is a Burmese military leader and politician who was chairman of the State Peace and Development Council (SPDC) from 1992 to 2011. During the period, he held key positions of power including commander-in-chief of the Myanmar Armed Forces and head of Union Solidarity and Development Association. In 2011, he officially resigned from his position as head of state, in favor of his hand-picked successor, Thein Sein.

Thein Sein (born 20 April 1945) is a Burmese politician and former military figure who has been president of Myanmar (Burma) since March 2011. Previously, he was Prime Minister from 2007 until 2011. He is generally considered to be a moderate and reformist in the new government.

Estate duty in Singapore

2012-01-06T07:53:00.003+08:00

Here is an interesting question about why estate duty was abolished in Singapore. http://www.tremeritus.com/2012/01/06/do-you-really-know-politics/

Here are the details of this event, which occurred on 25 August 2008.
http://www.ifa-sg.com/abolishment-estate-duty/

The voice of netizens

2012-01-05T20:43:00.001+08:00

Hi Mr Tan;
This is really hot reporting today on Yahoo Sg. In less than 2 hrs, there are more than 600 comments posted.
http://sg.news.yahoo.com/minister%E2%80%99s-comments-on-pay-cuts-spark-public-debate.html
The comments are very alarming, the voice and power of Netizens.

Mr. Brown show - Minister pay cut

2012-01-05T19:37:00.004+08:00

A minister shares his views on the pay cut
http://www.youtube.com/watch?v=yNfuyYsqRtM&feature=email

Committee to review Minister's Salary

2012-01-04T18:27:00.001+08:00

Someone sent to me a brief summary of the committee's recommendation, as set out below.

Ministerial salaries review committee proposes:Pension scheme to be removedPresident sees 51% cut and PM sees 36% cut;Minister’s salary to be cut by 37%Minister’s salary to start at $935,00www.reviewcommittee2011.sg

The final recommended salaries are quite close to my submission to the review committee at the start of the review. See this link. Sadly, as is the culture in Singapore, I will not get any credit for my humble suggestion.

Joint buying

2012-01-04T08:17:00.000+08:00

I bought a case for iPad2 for $80 (including protective screen). Someone said that a similar cover cost about Amazon.com. I check and found that, if the mailing cost is included, the total cost would amount to $80. However, if 3 people were to buy at the same time, the cost would reduce to $60 as the high mailing cost would be shared. The problem is arranging the logistics for this service.

If there is a website to bring people together to buy collectively (say 3 or more pieces) of any product, it may be worth the trouble. One of the buyer could be the coordinator to contact and deal with the other people. They have to sort out the payment and collection arrangement, as the item would be delivered to one person. This arrangement has to work on trust, i.e. that the other buyers will pay for their share of the product when it is received.

Do you think that this type of arrangement can work, perhaps for items where the saving is worth the trouble? Perhaps, some students may wish to earn some money by providing this service for a fee? What are your views?

Malaysia implements free outpatient care for seniors

2012-01-04T07:37:00.001+08:00

Read Lucky Tan;s views on this matter.
http://singaporemind.blogspot.com/2012/01/malaysia-implements-free-outpatient.html

Quote:
Singaporeans are always leery about such schemes implemented in Malaysia. Quality of care, for example, is an issue. However, for the many seniors whose ailments are common like high blood pressure, gout, arthritis, the access to free medication will relieve their financial burden. The PAP govt still makes the sick pay GST. They also collect GST on the amount you pay for medical insurance[Link]. The Singapore govt expenditure on health care is the lowest among developed countries as a percentage of GDP. This is done not achieved by being cost-effectiveness or efficient but by passing the rising cost of medical care to the sick and their family members. Not having a universal health care system in which everyone is covered and can go to hospital for treatment without family members having sleepless nights worrying about medical bills amplifies the effects of income inequality in a society with the largest income gap among developed countries.
Unquote

Barking up the wrong tree

2012-01-04T07:30:00.000+08:00

Latest: an edited version of this letter was published in the Straits Times Forum page on 4 January 2011. See
http://www.straitstimes.com/STForum/Story/STIStory_751527.html

Editor

Forum Page

Straits Times

I wish to give a different angle to the points raised by Jimmy Koh ("Don't give in to pressure against new insurance test", ST 27 Dec).

Mr. Koh argued that the new test is necessary "to equip insurance gents ... to advice their clients properly and fairly on ... investment linked policies". I am afraid that, like the proverbial dog, the advocates of this approach are "barking up the wrong tree".

Most investment-linked policies have high charges that take away more than 40% of the accumulated savings from the consumers. Although this is disclosed in the benefit illustration, how many consumers know about it? How many insurance agents point this out to the consumer? Even if the consumer asks about the high charges, also known as "the effect of deduction", some dishonest agents might explain that this is the cost of the life insurance protection - when the true cost is only a small fraction of the total deduction.

The truth is that a large part of the deduction goes to pay for the commission to the agent, the over-riding commission to the agency managers, high marketing expenses including the sales contests and incentive trips and the profit margin of the insurance company.

It it difficult for the insurance agent to give proper advice when they face this kind of conflict of interest. Do they look after the interest of the client and forego the attractive commission? I am afraid that this type of ethical issues cannot be answered through a written test.

After trying to deal with a similar issue for a few decades, the regulatory authorities in the UK and Australia have concluded that the only way to avoid the abuse caused by the conflict of interest is to ban the payment of commission for the sale of life insurance type of investment products. I hope that the Monetary Authority of Singapore will implement a similar approach, to safeguard the financial future of consumers.

Tan Kin Lian

Pressure on the kids

2012-01-03T22:51:00.001+08:00

Hi Mr Tan,
I read this report with concern, is this going to get worse?
http://www.channelnewsasia.com/stories/singaporelocalnews/view/1174482/1/.html

Many Sporeans tend to complain and complain yet they are mostly nothing but complain without action. They talk alot about voting for opposition, but many still vote for the PAP. They said one thing but when challenged or questioned in the open, they tend to avoid reality and become inaction.

Sporean parents are pressurising themselves and their children for various reasons. Majority do not want their children to be left out and so tuition and enrichment become part and parcel of the education/curriculum. There is no turning back and our next generation are going into the race without even knowing what is appropriate for them in future. They will only continue to compete and compete and unsure if they are competing for the right path in life! Very sad indeed, it is more than a pressure cooker.

In the article it reported that "......an Ang Mo Kio GRC MP Intan Mokhtar, who also lectures at the National Institute of Education (NIE), added that these enrichment centres play on parents' fears that their children would lose out if they are not stretched from a young age......"

In the first place, is our education system meant to stretch children from a young age? If so, then who is to blame who? OMG, very pathetic yet confusing. I do feel for these children but not the parents! When these kids grow up in future, they will likely adopt and impose the same practices and demands (as hope) on their kids instead..... onto the next generation....on and on, there is no turning back, perhaps until some drastic changes take place in this little island.

Troublesome to pay by check

2012-01-03T17:48:00.002+08:00

Do you realize how much trouble is taken to make a payment by check? You have to write the words and amount, the name of payee, the date and cross the check. You should also have a covering letter or write the details of the payment at the back of the check. You should also write the address of the payee on the envelope, put a stamp and mail the check.

If you factor the cost of the time taken by the admin staff to handle the payment, it could easily amount to $5 to $10. The party that receives the cheque also has to do a lot of work to clear the check. If they are automated, the cost may be lower, but still quite significant.

You should not make any small mistake as the bank will happily bounced your check, and you have to incur the cost all over again. The bank may even impose a hefty penalty on you for the rejected check. See the photo before for the work that is required to pay the check and to make sure that there is no mistake.

It is inefficient and costly for small businesses to make and receive payments by checks - but they do not have any alternative! I have urged our banks in Singapore to introduce an electronic payment system which includes a notification service.

My letter on this matter was published in Today newspaper and reprinted in this blog. I have also written to two banks, to the IDA and the Association of Banks on this matter. I hope that more people will come forward to express their support.

Wisdom on how to live life (book 1)

2012-01-03T12:15:00.002+08:00

Would you like to know:

(1) what are the purposes of life?

(2) how to achieve freedom in life?

(3) how to live with morality?

(4) how to decide whether to get married?

(5) how to select friends?

(6) how to live in peace and equanimity?

(7) which type of attachment can bring bliss?

(8) how to appraise world leaders?

(9) why it is important to get the “right” beliefs?

The book can be ordered here.

Hacking and identity theft

2012-01-03T07:25:00.000+08:00

Many people do not realize that it is a crime to hack into another person's account or to impersonate another person (i.e. identity theft) through the internet. In the absence of specific legislation, the legal practice in Singapore follow the UK. Read this report about the action taken by the Police to investigate illegal hacking. http://www.todayonline.com/World/Worldinbrief/EDC120103-0000062/Hackers-targeted-Gordon-Browns-emails--Report

As the use of Internet is an important part of our life, it is important for the law makers in Singapore (i.e. our Parliament) to pass the law to make it clear that hacking and identity theft are crime, punishable as a crime according to the laws of Singapore. It should also be made clear that the Police will take complaints and the necessary steps to investigate the complaints. This important issue cannot be left vague. This is the job of Parliament!

Protests against investment scams

2012-01-03T07:17:00.000+08:00

The people in China are prepared to show a strong protest against investment scams, according to this report. http://www.todayonline.com/World/EDC120103-0000055/Investment-scams-push-Chinese-to-rally

This type of cheating activity is happening in many places. The authority should act early, instead of letting the problem become so bad - a lesson for Singapore!

Need to offer a competitive price

2012-01-02T21:32:00.004+08:00

A Singapore composer offered to create some music clips for my mobile apps. She quote a price of $750 for the music clips for one app (and it is restricted to only that app), and said that it will be for my exclusive use. This was too costly for me - and I do not need exclusive rights - but she was not prepared to reduce the price.

Later, I found a source in the Internet where I could get the suitable music clip for $10 and it is not restricted to one app. I need to pay a total of $50 for several music clips to be used for all of my apps. I decided to use the music clips from this source.

I introduced the Internet website to the music composer, so that she can upload her music clips and sell them at a lower price on a non-exclusive basis to the world market. I hope that she can make a business by offering a competitive price to her customers.

Note: Our businesses are now used to charging exorbitant prices that they are out of touch with the world market! I do not blame these businesses, because they have to incur high operating costs in Singapore, but this type of business model is bad for Singapore.

Practical training on Android and iPhone platforms

2012-01-02T18:00:00.002+08:00

If you wish to have practical training on Android and iPhone platforms, you can send an e-mail to inbox@tankinlian.com.

You are required to have attended a course or have read and understood a book on the platform. Your training will be at any time during 10 am to 6 pm on Mondays to Saturdays. A PC and working desk will be available for your use. You will be given a project to modify and will have access to an experienced developer.

On completion of your training, you will have the chance to work on projects and earn an additional income.

ADDITIONAL NOTE
Please provide information on the following:
1. Your name, email address, telephone, age and occupation
2. Have you attended any course or read any book in Android or iPhone platforms?
3. Do you have any experience or knowledge of Java, C++ or other platforms?

I expect the trainee to have some prior knowledge of the Android or iPhone platform, as I will be providing the practical training (and not the basic training on these platforms).

Adverse reactions to PM Lee's speech

2012-01-02T17:25:00.000+08:00

A Singaporean, who migrated to New Zealand, sent this e-mail to me.

Hi Mr Tan,Interesting start of the year 2012 with some interesting reports and appetizing comments following it;http://sg.news.yahoo.com/strengthen-values-of-tolerance--respect--empathy--pm-lee.html http://sg.news.yahoo.com/-comprehensive-perspective-needed-for-discussions-on-population-.htmlHope you have read those reports and more interestingly are the comments following the articles.

The reaction in Yahoo News to PM Lee's speech is overwhelming negative.

Singapore is too expensive

2012-01-02T16:12:00.003+08:00

My Singaporean friend who travels to Hong Kong regularly in his regional marketing job, told me that he has stopped buying electrical products in Singapore as he could get them at least 20% cheaper in Hong Kong including controlled products like iPad and iPhone. I asked him to send me specific examples about the difference in prices.

His observation has confirmed my gut feel that Singapore has become very expensive in recent years due to high property prices, high rentals, GST, and high operating cost and inefficiency.

A few months ago, I wanted to buy a device to run my PowerPoint presentation remotely on my laptop. The shop in Thomson Plaza offered me the device for $120. I refused to pay this high price. Later, I found a good quality alternative (not the same brand) for less than $20 (including mailing) through the Internet.

Unwanted mail

2012-01-02T15:56:00.000+08:00

Here are the unwanted mail that I received in my physical mailbox for the past two weeks, including the following:

Over 1 dozen invitation to property launches
Marketing flyers for various types of products
Magazines for my family members (and they do not read them)
Annual reports of companies (can be made available in a website)

I do not know how to stop the wanton waste. It would be nice to have a government sponsored website where the public can register their request to stop the unwanted mail. Let us do our part to save the environment. I hope that the IDA will take up this suggestion.

A simple online form

2012-01-02T11:40:00.001+08:00

Many online forms in Singapore websites are too complicated. They ask for more than 10 fields of information (most of which are irrelevant) and produce so little space to enter the question.

A good online form just ask for the essential information. Here is an example of a good online form. They even provide an email address!

Do we need more or less regulation?

2012-01-01T21:39:00.000+08:00

Should we have more regulations or less regulations? It is not a matter of quantity but of quality. We need more of the necessary regulations and less of the unnecessary regulations. We need more regulation to stop people from cheating other people, but we need less regulation that make life difficult for people, without achieving any purpose. The trouble is ... our leaders do not know the difference! Do you agree?

2011 - a year of awakening

2012-01-01T16:57:00.001+08:00

Read this article by Lucky Tan: http://singaporemind.blogspot.com/2012/01/2011-year-of-awakening.html

I agree with all of his views, as they are quite close to my own views. Lucky Tan also said that there is a need to raise productivity in Singapore, rather than depend on cheap imported labor. I wish to give my own perspective on this issue, based on my past three years experience in running a small company in Singapore.

Our government agencies have added unnecessary costs to businesses from their impractical measures. Their websites are complicated and their online processes are painful to use. By trying to save a few minutes of their staff's time, they add several hours to the time of the public. We still make a lot of payments using physical checks and send a lot of mails and notification using physical mail. We are quite backward in these areas, compared to many first world countries. These inefficiencies increase the cost of running a business in Singapore!

Singapore has a lot of challenges ahead. They cannot be solved if our leaders continue to act in the old ways. Only best hope is that the leaders realize the extent of the problem and are prepared to face them.

More people will fall into the same trap

2012-01-01T06:19:00.000+08:00

I received a desperate plea for help from an widow who lost a lot of money on failed investments made on the advice of the relationship manager of a bank. The victim was advised to invest in dual currency and other linked products on the assurance that they were "safe". The bad advice was given in spite of her constant reminder to the relationship manager that she did not want to take risk!

I gave this reply to her.

I have come across many cases that are similar to yours. It is indeed very sad that our Government allowed this type of environment to continue for so long and does not step in to check the abuse.
The only way for a victim to get justice is to take the case to court. Here the odds are overwhelming. It is costly to fight against the big legal firms engaged by the bank. Furthermore, the court tend to apply the law rigidly and hold the victim responsible for signing away their rights in the forms that were given to them by the bank.
Another avenue is to write to the newspaper, but many victims prefer to be anonymous.
Due to these reasons, these cases are not publicized and more people fall into the trap over the years .
Are you willing to consider what needs to be done, i.e. to take the case to court or to write to the newspaper?

I wish to write this word of advice to all readers of my blog. Do not invest in complex financial products, especially those that are being sold to you by financial advisers or relationship managers. Many of these advisers might be ignorant of the risks of these products themselves, so they may be honest in telling you that they are safe (and they are mistaken!). They work for the banks that you have trusted for many years, but regrettably, the bank does not wish to take the responsibility for the bad advice and failed investments.

Please help to pass this message to your friends, so that they can avoid making the same mistake.

Happy New Year 2012

2012-01-01T01:00:00.001+08:00

A pro-active regulator acting on behalf of consumers

2011-12-31T09:58:00.000+08:00

Verizon (a telephone operator in the US) wanted to charge a "convenience fee" of $2 to its customers making a payment through the telephone. It drew protest from consumers. The regulator, i.e. the Federal Communication Commission, felt that it was their duty to look into this fee "on behalf of consumers" to see if any regulation has been infringed. Verizon changed its mind and decided to withdraw this fee.

Read this report "Verizon scraps $2 fee" http://money.cnn.com/2011/12/30/technology/verizon_fee_canceled/index.htm?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29

The approach of the regulator in America seem to be quite different from the regulator in Singapore. The US regulator felt that it was their duty to look after the interest of the people. The Singapore regulator would probably say that this is a commercial decision, and that consumers could go to another service provider.

I prefer the US approach.

Today Voices: Automatic notification for Payment

2011-12-31T09:46:00.000+08:00

Editor, Voices, Today

I CONGRATULATE the Singapore Land Authority for introducing an electronic system to allow lawyers to notify the banks of details of payments paid into conveyancing accounts, instead of using hard copy forms. This is a useful step to reduce paperwork and improve productivity.

I notice however, that this is an initiative taken by an agency to cover only a small section of the transactions. It still requires the payer to take a separate step to send a notification to the payee.

I urge our banks in Singapore to introduce a common system for electronic payment and notification. This system can ride on the existing security infrastructure of the banks to validate the payers and allow them to make electronic payments through a common payment gateway to the payee accounts. The process should include an electronic notification to be sent to the payees.

This type of arrangement has been in force for several years for payments through PayPal. It is time to update our antiquated payment process to match the best in practice in other countries, and to reduce the large volume of cheque payments and notification letters that still flood our mailboxes.

I hope that the Monetary Authority of Singapore and the Infocomm Development Authority of Singapore will take the lead to make this long-overdue change.

Tan Kin Lian

Managing personal risks

2011-12-30T10:10:00.002+08:00

Here are some tips on when you should buy insurance and when you should self-insure (i.e. retain) the risk.
http://tankinlian.com/admin/file.aspx?id=445

Electronic payment and notification

2011-12-30T08:08:00.002+08:00

The Singapore Land Authority has introduced a useful system to allow lawyers to notify banks of payments through an electronic notification, instead of manual forms. More details here:
http://www.todayonline.com/Singapore/Singaporeinbrief/EDC111230-0000022/Conveyancing-through-ePI-for-property-lawyers

However, this still requires a separate exercise for the payer to notify the payee. A better system is to allow the payments to be notified automatically - similar to payment through Pay Pal. The banks in Singapore should adopt a common system to allow all payments to be transferred electronically and notified automatically. This system should cover all types of payments, and should not required any agency, such as the SLA, to set up a separate system for the notification.

Legal responsibilities in the Internet

2011-12-30T08:04:00.000+08:00

Many people do not realize that hacking is a crime and that defamation through the internet can be prosecuted as a civil suit. Read this article to get a better understanding of your legal responsibilities. http://www.todayonline.com/TechandDigital/Digital/EDC111230-0000020/Social-media--Do-you-know-the-legal-lines?

Stop taxis from cruising the road - a suggestion from Mr. Lee WL

2011-12-30T07:56:00.002+08:00

Please share your views to this idea contributed by Mr. Lee WL

My idea:
- Taxi companies to build big carparks in different parts of Singapore to house all the taxis.
- Taxi drivers can take a rest, surf internet and interact with one another in rest areas.
- Each driver will take queue up for taxi booking calls from customers
- They will drive to the customer's location only when they get a booking
- They will drive back to one of these "big taxi carparks" to queue for customers again

Benefits:
- Reduces fuel wastage (substantially). No taxis cruising on the roads. Environmentally-friendly.
- Reduces fuel costs for taxi drivers (substantially).
- Less road congestion. Empty cruising taxis on roads are not using the space they occupy on public roads "productively".
- More rest for taxi drivers. They need not cruise around Singapore to look for customers. Probably will reduce accident rates too.
- More productive use of time. They can use the queuing time at rest centres to rest, surf internet, self-study, interact with other drivers and do other more productive things.
- Possibily cheaper taxi rides. Because of substantial reduction in costs.
- More people may be more open to becoming taxi drivers because of better working conditions and higher pay (is it possibe?)

Disadvantages:
- Longer taxi waiting time for commuters. Taxis need time to travel from these "big taxi centres". Possible solution: when commuters get used to this new system, they will call to book taxi before they leave their homes. This reduces the waiting time. When this system is in place, it will also mean that commuters need not waste time trying to flag for taxis along roads. They know that the only way they can get a taxi is through booking calls.

In conclusion, empty taxis cruising on public roads is:
1. Waste of the drivers' time
2. Unproductive use of space on public roads
3. Not environmentally-friendly
4. Increases costs of operating taxis

Mr. Lee WL