Bhutan and Singapore

Here is how Quitter (Wing Lee) view this matter:
https://mail.google.com/mail/?ui=2&ik=f1f8b591ea&view=att&th=1336e65f1600b0fd&attid=0.1&disp=inline&realattid=f_gul47b4x0&zw

My observation.
When the beloved King of Bhutan recently married, the whole country rejoiced. Singapore should learn from Bhutan, rather than pass negative comments about Bhutan. Read this article and see the 1,000 over comments.
http://news.yahoo.com/king-bhutan-marries-commoner-bride-040837856.html

Life insurance and financial planning for a young family

I wish to share this important tips for every young family, and for young people who will be started a family a few years later. It can make a lot of difference to your financial well being - more important than the time that you spend to learn the subjects to get a degree.


http://tankinlian.com/admin/file.aspx?id=589&PK=5992645d58d5102f8aebde1ae83d78a1

Online processes of Government ministries

The online processes of several Government ministries are terrible - they make life difficult for the public. I have bad experience with the Ministry of Manpower in respect of getting work passes and making CPF top-ups. My friend told me that he had a lot of trouble in submitting an application to work as a relief teacher in the Ministry of Education website.

I have submitted several feedback to the Ministry of Manpower giving details of the difficulty faced by me. They give me a polite reply each time, but do not really address the root of the problem - the online process make life very difficult for the public. Instead of improving national productivity, they make things worse. The ministry save 1 hour, but the public has to spend (say) 5 hours.

In many cases, the process are so complicated that the public has to call the helpline. After a while, many of these helplines (especially from the Ministry of Manpower) do not respond (i.e. cannot get through). I can understand the difficulty of these helpline operators. They are deluged with so many questions from the public seeking help.

The underlying problem is the complicated process. They are designed to save time for the government ministry, and they add to the overall waste of national resources. I hope that someone from the Ministry of Finance, who is supposed to drive national productivity, will respond to me (kinlian@gmail.com). My feedback to them in the past were also not attended with seriousness.

Investing in stock in a volatile environment

Should a young person invest hard earned savings in stocks in a volatile environment? The answer can be found here: http://money.cnn.com/2011/11/04/pf/expert/young_investors/index.htm?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29

I agree with the advice that money for the long term, e.g. for retirement, should be invested in stocks and that money needed for the short term, e.g. to make down payment for a home or other specific purpose, should be invested in a secure asset, such as an insured bank account.

Upgrade Medishield for elderly?

Hi Mr Tan Kin Lian ,

I hope you can advise me on this Medishield upgrade . Presently my wife and i are both 59 years and on basic 

Medishield . I am wondering whether it is better to upgrade and even buy riders to cover the deductibles and co-insurance .  I am thinking not so much about a better bed in the hospital but whether the present basic Medishield is adequate enough to cover major illnesses . Another worry is the annual limit to medical claims for basic Medishield  and  also riders are paid in cash .

REPLY

Please read my views on Medishield in these many articles. After that, you have to make your own decision.

http://tankinlian.com/Information.aspx?q=medishield

NOTE: Consumers should attend the talks on Financial Planning and Life Insurance organised by FISCA. More details can be found at http://easyapps.sg/assn/Org/Event.aspx?id=5. (The last talk on Life Insurance was cancelled due to lack of response.)  Consumers should attend these talks and be educated, rather than expect to get free advise to their specific questions - as they may end up being conned by dishonest advisers.

It is all right to get rich in an honest way, but it is now quite common for people to get rich by being dishonest and they get away with it.

Most Americans don't begrudge great riches to anybody who works hard, takes real risks, and creates things of value. As evidenced by the positive outpouring for Steve Jobs, great entrepreneurs are still celebrated. But there is an implicit social contract that links rewards to effort and accomplishment. If many people now believe that corporate America has violated that contract, is it surprising? At many big corporations, the senior managers have seemed more interested in stuffing their pockets than building for the long term. Gargantuan pay packages are only the start of it. Think boards of directors packed with patsies, books cooked to juice earnings, potential whistleblowers silenced, golden parachutes, and finally taxpayers obliged to save expensively tanned hides. The thing that is really surprising is that it has taken this long for public anger to well up.

http://finance.fortune.cnn.com/2011/11/04/one-percent-wake-up-call/?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29

Good experience with Forex Training Course

Many people had bad experience with forex training courses. They paid a high fee to get the training and lost money  in the trading activities (as the methods are not reliable). Here is an exception. This student still lost money, but he felt that the training provided was worth the money spent:

Dear Mr Tan,It would be my pleasure to share my experience with you.
Let me tell you upfront that I am not yet profitable trading forex.  Please allow me to explain why I was still happy with the course.
I took up the forex training course with X in December 2010.  At that time, I was retrenched for about 3 months and was unsuccessful in finding a new job.  With time on my hands and not knowing what else to do, I attended a few forex sales seminars and eventually signed up with X.  I paid about $3000 upfront for the course.
Before I signed up, I had already educated myself on forex trading.  I was aware that there were forex training providers who created the impression that forex was easy money.  X was honest about what forex trading was really about.  This convinced me to sign up.
The course started with 2 days of classroom training over the weekend.  This covered the theoretical knowledge needed to trade forex.  After the classroom sessions, students are entitled to attend regular tutorial sessions for 1 year.  The tutorial sessions were officially on the evenings of Mondays and Wednesdays.  During each session, the Chief Trainer Y would conduct an analysis of one or more currency pairs to demonstrate how he applied his techniques and then pointed out potential trades.  This would be followed by hands on session during which students learn to apply the techniques on their demo accounts while Y would go around answering questions. For those who have the time, X was open daily for students to go in and trade with other traders. Y would conduct two analysis for the students; once before London session opened and once before NY session.  As I did not have a job, I went in daily, from afternoon until night.  During these sessions, Y would analyse a currency pair and point out potential trades.  I found out over time that most of his trade calls were good and resulted in profitable trades.  However, it was a different matter when I did my own analysis and took my own trades.  Most of my trades turned out to be losers.  Faced with Y's successful trades and my own unsuccessful trades, it became obvious to me that it was not the technique but the trader that was the problem. I spent practically all my weekdays at X until I found a job in June.  When I was there, I found Y to be genuine about helping his students.  I was using air-con, Internet and electricity for free.   Although I could not go into X anymore because of work, I still joined the Wednesday sessions via webex meetings.  This was something additional that Y provided.  I didn't have to pay a single cent after that initial $3000 payment.  In fact, I wondered if he could be profitable like this. When I saw your online survey on forex and a comment that all forex courses are overpriced and useless, I knew where you were going with this.  You probably heard feedback from unhappy people who felt that they were cheated by forex schools.  Hence, I felt I should provide a balanced view.  There are indeed forex schools that use questionable tactics to sign up students but there are genuine ones too. Evaluating whether a forex course is good based on trading results can be tricky.  This is because forex trading techniques are easy to learn but it takes time and experience to learn how to apply them correctly.  It takes time, discipline and effort and is not a get rich quick scheme.  Like in any business, only a small percentage eventually master the skill to become successful. I personally found that it is quite safe to trade forex.  I am still working on my forex trading skills.  I have heard of people losing lots of money trading forex but it was usually because they could not follow simple trading rules that would keep them safe.  For example, students are taught not to trade large amounts until they are successful with paper trading or trading with mini accounts for a few months.  Another rule is that you are not supposed to risk more than a small percentage of your capital per trade.   However, there are many people who simply could not follow these simple rules. Mr Tan, if you have read up to this point, thank you for your patience!  And thank you for what you are doing to help ordinary Singaporeans! 

iPhone Apps

I have updated the apps in iPhone for Tangram and Shape Quiz to show a small image (on request) to guide the player in creating the shapes. This will make the app more interesting to the newbie. It is colorful, fun and trains the imagination. The apps can be downloaded from App Store by searching for "Tan Kin Lian".

High Notes and Pinnacle Notes

The Straits Times journalist asked for my views about the dismissal of the appeal by the High Notes investors against the earlier judgement. I replied that I am sad to learn about this outcome for the following reasons:

• The investors already lost all of their investments. They now have to bear their legal expenses and, possibly, the expenses of the DBS lawyer.
• This decision came around the same time as the good news received by the Pinnacle Notes investors that the New York court has agreed to hear their class action against Morgan Stanley. Furthermore, the New York case is being heard under a "success fee" arrangement where the investors do not have to bear any legal cost, if they do not succeed in the case.
• The High Notes were created by DBS and sold to its own customers. This gives a higher responsibility to DBS, as they should be aware of the risk of this product and should have communicated it clearly to their customers The other credit notes were created and sold by different banks.

I hope that DBS Bank will at least undertake to bear the legal cost of both sides, so that their customers do not have to bear any further loss. It would have been nicer if DBS Bank had offered to give an ex-gratia payment to the investors, instead of having this case decided in court. I believe that DBS Bank might have sold a similar product in Hong Kong and they probably had agreed to compensate the investors in some way - but I do not really have the facts.

Tan Kin Lian

Investing in Options

I do not like to invest in options. My reasons are:

• The price of the option is decided by an expert who takes the other side of the trade. This expert is likely to fix a price that will give him a profit (after allowing for the future possible outcomes). As the other party to this "bet", the retail investor is likely to make a loss.
• It is possible for the option issuer to manipulate the price of the underlying shares to avoid making a loss. For example, if the option pays out a large sum of money when the underlying share hits a certain price, the option issuer will buy or sell the underlying share to avoid hitting the strike price. The cost of buying the manipulating the price of the underlying share will be lower than the  payout on the option strike.

If a retail investor wishes to speculate, it is better to buy or sell the underlying share, rather than buy an option. For long term investors, it is better to buy blue chip shares and keep for the long term to enjoy the dividends and the long term capital gain (and forget about short term fluctuation in the share price).

Lesson: Do not invest in options or other derivatives. Buy or sell the underlying share. Speculating in futures is all right, as the price is a direct reflection of the underlying share index.

Policing the Internet

I found this statement in Singapore Notes:

In the CNA Talking Point episode "Policing The Internet", MP (Tampines GRC) Baey Yam Keng claimed that the Ministry of Law sees the internet as another platform for real world criminals to operate from, and people need to be protected from fraud, cyber-bullying, etc. The timing of gazetting online blogs had nothing to do with policing the internet, he said with a poker face. While at it, he might as well add that the president's addendum had nothing to do with the online revelations about the circumstances of his son's 12 year deferment. The wording of the Ministry of Law statement on the subject goes like this:"The proliferation of new media has brought about new challenges to the rule of law and the ministry will review legislation to deal with harmful and unlawful online conduct". Smells like a good-cop-bad-cop routine is in play.

I am in favour of policing the Internet to make sure that it is useful for lawful purposes. This is to prevent people from doing harmful things while remaining anonymous. I know that it is difficult to police the Internet but it should not deter us from taking the challenge.

The first step is to lay down the law clearly and identify what are offences and crimes. Some examples are:

• Defamation
• Bullying
• Telling lies
• Cheating

These are offences in the real world, so it should not be different in the Internet world. The next step is to enforce the law and take action against the culprits. This is not different in the real world. Someone will report to the Police of an alleged crime. The Police will have to investigate and gather evidence to find out the culprit and charge the culprit in court. 

The next challenge is to have sufficient people to do the work. There is no short cut to enforcing the law - you need policemen and public prosecutors. These are good jobs - much better than having more people to be insurance and property agents!

I am also in favour of a requirement that people posting statements should be identified. They can use a pen name, but their real name should be registered somewhere and can be traced for accountability. I do not support people giving views and statements under anonymous cover, as the lack of accountability can lead to bad behaviour.

Some people feel that they have to be anonymous to avoid bullying by the people in power. This is not a good reason. If the people in power act badly, we should vote them out of office. But if they are elected, we have to live with the consequence, i.e. obey the rules and the law - including speaking with accountability.

Risk of Credit Default Swaps (CDS)

Suppose you bought Greek bonds and to protect yourself against default, you bought a CDS and paid a premium for this protection. The Greek government now offers repayment with a 50% "haircut" (i.e. you suffer a 50% loss) and you wish to make a claim on the CDS. Will you get paid for your loss?

According to this article, you will not be paid, as this is called a "voluntary settlement". On the other hand, there are many investors who were on the other side of the CDS during the Lehman crisis, and they lost all of their investments. It is "tail they win, head you lose".

Lesson: Avoid all types of complex instruments. Just invest in the STI Exchange Traded Fund or in blue chip share". Attend the FISCA Financial Planning talk - http://easyapps.sg/assn/Org/Event.aspx?id=5

DBS High Notes Investors Lose Appeal

It is sad that the retail investors lost the appeal with cost. This means that they lost their investment and also have to pay their lawyer's fees. So, their loss is compounded.

Singapore Investors Lose Bid to Recoup $14 Million Lehman-Related Losses

http://www.bloomberg.com/news/2011-11-02/singapore-investors-lose-bid-to-recoup-lehman-related-losses-on-appeal.html

The Bloomberg article did not mean the words "with cost". I remember reading it in the newspapers.  I believe that this meant that the investors also have to pay the legal fees of DBS Bank (but I need someone to confirm this fact).

In contrast, read this Good News for Pinnacle Notes Investors

Collapse of MF Global - the lessons

Read Lucky Tan's article here.

The collapse of MF Global in the USA have a direct impact on retail investors in Singapore. They have money in their accounts with this brokerage firm and are worried that they may not be able to get their money back.

This brokerage firm lost a lot of money in the European bonds. It was reported that they might have transferred some of their client money to cover these loses.  It could be a big mess.

600 million missing in MF Global

This raises the issue about financial institutions, such as banks and brokerage firms, being involved in large scale speculation with their shareholder's money and, through illegally means, with their client's money. How can it be prevented?

I recall reading about the Glass Stegall Act in the USA which used to separate investment banking (where the speculation is carried out) from commercial banking (which has the fiduciary duty of looking after the money of their clients. This Act was passed during the Great Depression - after the lesson of the global financial collapse in 1928 - to address the same problem. With the passage of time, the lessons were forgotten and the key provisions of the Glass Steagall Act was repealled. This allowed the replay of the same drama.

Here is a description of the Act from Wikipedia:

The Banking Act of 1933, Pub.L. 73-66, 48 Stat. 162, enacted June 16, 1933, was a law that established the Federal Deposit Insurance Corporation (FDIC) in the United States and introduced banking reforms, some of which were designed to control speculation.[1] It is most commonly known as the Glass–Steagall Act, after its legislative sponsors, Senator Carter Glass (D–Va.) and Congressman Henry B. Steagall (D–Ala.-3). Some provisions of the Act, such as Regulation Q, which allowed the Federal Reserve to regulate interest rates in savings accounts, were repealed by the Depository Institutions Deregulation and Monetary Control Act of 1980. Provisions that prohibit a bank holding company from owning other financial companies were repealed on November 12, 1999, by the Gramm–Leach–Bliley Act, named after its co-sponsors Phil Gramm (R, Texas), Rep. Jim Leach (R, Iowa), and Rep. Thomas J. Bliley, Jr. (R, Virginia).[2][3]
The repeal of provisions of the Glass–Steagall Act by the Gramm–Leach–Bliley Act in 1999 effectively removed the separation that previously existed between investment banking which issued securities and commercial banks which accepted deposits. The deregulation also removed conflict of interest prohibitions between investment bankers serving as officers of commercial banks.

What are the lessons for today? Financial services and banking have to be more strongly regulated. Some specific measures include the following:

• To separate investment banking from commercial banking

• To require all trust account to be held by the banks, and not the brokerage firms. However, the law has to be updated to make it convenient to operate these trust accounts conveniently and through electronic means - and still retain the value of a third party oversight.

If these measures are not addressed, we will continue to see a repeat of other failures, similar to MF Global.

Singapore's crime rate

Lucky Tan asked:

Singapore has the highest prison population per capita after USA among developed countries. We have the 2nd highest rate of incarceration in South East Asia. Our rate of imprisonment is triple that of Malaysia. There is this poster that the SPF put up around housing estates that says "Low Crime Rate Does not mean no crime". If our crime rate is low, why are there so many people imprisoned? The USA has a large prison population because the crime rate is high.
http://singaporemind.blogspot.com/2011/11/singapores-high-prison-population.html

Medicare in USA - complicated and expensive

USA provides Medicare to its elderly. It is a generous scheme, but it is too costly. And it has become very complicated. This kind of problem is felt by most countries in the world. And Singapore is no exception - except that in Singapore, the people have to bear a large part of the cost. And insurance is not a solution - as it can get out of control.

http://money.cnn.com/2011/11/01/pf/medicare_plans.moneymag/index.htm?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29

What is the solution? I will say frankly what I think - and it will not be popular. We have to manage expectation. We must realise that people will have to die one day, and that using expensive medicine to prolong life is not the answer - the person who is cured will suffer a lower quality of life and the treatment will bankrupt the family (or the state). The medical profession will be able to find new wonder treatments, but they will be too costly for the patients or the country to bear, and will make the medical specialists rich.

We must educate people to accept that there is a financial and practical limit to medicine, and to accept that life will have to end one day. If doctors think that they can cure the patient, they should only collect their fees on success, and not on failure. If this success fee is practised, many doctors will not undertake treatment that are not likely to succeed.

Mobile website for FISCA

If you have a mobile phone, you can access the mobile website of FISCA at http://fisca.mviso.com

Regulation on Pay TV contracts

The MDA has now decided that they have to step in and regulate the Pay TV contracts as follows:

• The contract should not exceed 2 years
• There should be pro-rata refund on cancellation of contract.

This move, which is taken after a long time of free market practices, recognizes the weakness of the free market system. The businesses make things complicated and opaque and imposes unfair charges to boost their profits and take advantage of consumers.

There are many similar practices of this kind, for example, in life insurance contracts. In some countries, the regulators have decided to ban front end commission on these long term contracts, as they impose a heavy penalty on consumers, who were not aware about the front end costs.

There are so many bad practices that rip off consumers. The situation is especially bad in Singapore due to our legal system. At least, in USA, lawyers can take up class actions on behalf of consumers - but not in Singapore. 

I hope that our political leaders will learn about the reality of the free market and take the step to protect consumers - rather than leave things to be sorted out in the market. If the market can take care of these matters, there is no need to pay big salaries for ministers, political leaders and top civil servants.

Life in Denmark

One of my SMU students went for a few months of attachment in Denmark. Here is her observations about life there.

Hi Prof Tan, Life in Denmark is very different from Singapore. People here are very relaxed and know how to enjoy their life. In fact, they are one of the happiest people in the world. As you might now, Denmark is a welfare state with the highest income tax rate in the world. However, the welfare system is very well-run and efficient. Thus, the living standard over here is very high and most of the Danes receive good education. Compared to Denmark, Singapore is more bustling because we work way too hard. Here, the shops and supermarkets close at 6pm on average. There are many differences but I am really enjoying my time here so far.
I wish you have been well too. Hope to hear more about your experiences and thoughts about the presidential elections when we meet. 

Good news for Pinnacle Note Holders

I received this wonderful message from the US lawyer handling the class action. They have succeeded in getting the case heard in New York. There is still a lot of work that has to be done, but this is one major hurdle that has been crossed. As this is a class action, any compensation that may be won in the legal suit will be shared with all Pinnacle Note holders, regardless of whether they had been among the original complainants.

Dear Mr. Tan,
You may already have heard, but yesterday the NY Court denied Morgan’s motion to dismiss, which means that we can proceed in NY.  We still have a difficult road ahead of us, but this is a significant victory in the first battle.
Warm regards,
Dan

An endorsement of the FISCA Financial Planning Workshop

Dear Friends,

On the 29 October, I just attend a talk by Tan Kin Lian on the basics of financial planning & investment. I thought it is good and I just wanted to share. (It is the 2nd time I'm attending it since I wanted to make sure I understand some important concepts presented by TKL)

Just when we think we know enough to manage our own finances (especially for those with kids), please consider again. Especially your friendly insurance or property agents (who happens to be your relatives or good friends) offering you financial planning advice, it is when we lose the most money (unknowingly) . These agents are not liars, for most part, they are simply "honestly wrong". A simple question, what is the biggest risk for a young person from age 25 - 55 yrs old ? Please make time to attend TKL's talk and you will know the answer. The knowledge gained will save you loads of $$ in the long term.

This talk is not about some secret recipe to strike it rich overnight or coercing you to buy some software package to make big bucks in the stock market. Instead, it is to share with you the basics of financial planning (budgeting, debts, savings, what insurance policy to buy, how big of a property you can afford, retirement planning, etc..) which has NOT been properly taught to most people. I feel it is time to put it right.

About Tan Kin Lian and his FISCA club:
Tan Kin Lian is the former CEO of NTUC Income. Since stepping down as CEO in April 2007, his activities have included organising public rallies for people who lost their money due to investing in Lehman Brothers' Minibond products to seek redress, and setting up FISCA, an organisation to teach people about long-term financial security.

TKL is a sincere and knowledgeable gentleman who is well versed in insurance products and also overall financial planning due to his previous work. I have benefited much from his talk and reading his books.

His workshops (and books) are developed such that it is easily understood by the lay-person, I have both his books
(1) Practical guide on financial planning
(2) Get Value from your life insurance

Please also consider joining http://www.fisca.sg/ as a member for $36 per annum. FISCA is a non-profit org. and its objective is to improve financial literacy among Singaporeans. As a FISCA member, one get to attend useful talks at a discounted rate of $20/$15 compared to non-members $30.

This is taken from FISCA website:
"FiSCA is committed to being an unbiased, up-to-date financial site with quality articles and advice to help improve financial literacy among Singapore consumers. Being a non-profit driven organization, FiSCA does not solicit sponsorship from commercial companies such as banks, nor do we get revenue through online advertising. We aim to be considered an objective and knowledgeable third party in financial-related issues, in order to provide quality, un-biased information on financial education to the general public. "

TKL has a similar financial planning talk coming up on the 26th November (write up on the event is attached), if you are keen, I can sign you up at a discounted rate of $15 since I'm a FISCA member. (Note: I don't make any money by signing you up or writing all this, just wanted to share this useful talk with you)

Time and money spent on gaining financial literacy is properly the best investment you'll ever made in yourself.

PruFlexi Cash policy taken by a student

A student bought a PruFlexi Cash policy and after paying the premiums for 8 months, he asked my views about terminating the policy.

I asked him to send the benefit illustration to me. The total premium for 3 years would have been $3,600 and the cash value would have been $800, giving a loss of $2,800. If he terminate the policy now, after 8 months, the loss would have been $800. It seemed to be better for him to terminate the policy. The sum insured under the policy was only $15,000.

What was the purpose of buying a policy that offered a miserably low sum insured and resulting in a loss of $2,800 in savings for 3 years? There is a complicated series of cash payments which can be accumulated with interest at 1.5% p.a. After taking all of these payments into account, the yield on the policy looks rather poor. It would have been difficult for a lay person to understand how to evaluate such a policy - as it is quite complicated.

I asked him to check out the facts with the agent, as I could have been missing some essential point.  (Note: I have changed some figures slightly, but the essential facts are shown above.)

GENERAL ADVICE

It is a bad idea for a student to buy any life insurance policy - as it does not serve any useful purpose. Consumers should also avoid buying any complicated financial product that is difficult to understand.

Confusing bonus system for life insurance policy

Dear Mr Tan,
Recently I asked my friend to send me a quotation on income's vivolife policy.

Something that I don't really understand is the "terminal bonus" shown. On page 9, it showed the duration and the percentage of terminal bonuses for the years 2008 - 2010. What I don't understand is a percentage of what? A percentage of the reversionary bonus that had been declared thru'out the years or a percentage of the sum assured per $1,000?

Is the reversionary bonuses that is declared annually same amount for both death and surrendered portion? What I meant is that if for example, year 2010, the insurance company declared $7 per $1000 S.A for this particular policy. Regardless of if I were to surrender or make a claim, the bonus that is still payable in whichever situation is still $7 per $1,000 S.A.

If the above hold truths, then in the B.I of the attached, at year 40, at projected 5.25%, why is there a difference of about $40,000 in the total, when the difference in the guaranteed payout of death and surrender, respectively is about $20,000 difference?

Looking at the surrender terminal bonses and the death terminal bonuses for both 31 - 45 years, the terminal bonuses is shown at 186% - 212% .

REPLY
Please direct your question to the agent who is selling the policy to you, or to the management of NTUC Income.

I do not wish to spend time explaining this type of complicated matters, when it is the duty of the people who create the product to make the explanation. I only advice people to avoid buying any product that they do not understand.

Contractors for household services

The list of contractors for household services has been updated to show more services:
http://www.tankinlian.com/Redirect.aspx?PK=418378434b8e102f8aebde1ae83d78a1

The One Percenters

They are CEOs and money managers, doctors and lawyers, as might be expected. But they are also computer technicians, scientists and even farmers. Some are singers and movie stars (even though they may not like to admit it) and the rest of them are spread among various professions.


These days they are also the most vilified members of American society – also known as the 1 Percenters, who control about two-fifths of the country’s wealth and fuel nearly 100 percent of the protests around Wall Street, through the rest of the country and around the world. 


http://www.cnbc.com/id/44960983/

Hotels fees

Hotels are now charging fees for services that used to be free. This bad practice should be disallowed. This is the bad side of capitalism and the free market. Regulators should now step in to discharge their responsibility to the consumers.

http://money.cnn.com/2011/10/31/pf/hotel_fees/index.htm?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29

Qantas grounds its flights

SYDNEY - Qantas CEO Alan Joyce is no stranger to clashing with unions. But his extraordinary move to ground the airline's global fleet over labor unrest is his biggest gamble yet and has angered unions, passengers and the Australian government.

The increasingly bitter dispute, which has dragged on since September, covers the sensitive issue of jobs in Australia being outsourced to Asia and even the very survival of the iconic 90-year-old national carrier nicknamed "The Flying Kangaroo."

http://www.cnbc.com//id/45093268

MY VIEWS:

When the workers go on strike, they disrupt the operations and cause inconvenience to the public. In this interesting case, it is the management of Qantas that took the unusual decision to "go on strike" and ground its operations.

I respect the actions taken by the Australian unions in fighting for the rights and job security of their members. Many businesses find ways to increase their profits at the expense of their workers, and the profits can be absurdly large. I do not know if, in the case of Qantas, the airline has to reduce cost to survive, or just to increase its profits.

FISCA Financial Planning Workshop on 29 October

The workshop on 29 October was well attended with over 30 people, mostly young people. The participants told me that the talk made them more aware about the good and bad financial products and was very useful to them. I asked them go get their friends and parents to attend the next talk, which will be held monthly. It is important that they make the right financial decision and avoid giving away a lot of money on bad products.

Several participants said that they came especially to hear my talk! They must have got the recommendations from their friends!

More details of future workshops can be found at http://easyapps.sg/assn/Org/Event.aspx?id=5. Register early!

Speculators are increasing the prices of hard disks

Quote: "Speculators are gouging the market significantly and in some cases making enormous profits out of the people of Thailand's misery," Buckley told Reuters. He declined to say which distributors.

http://www.cnbc.com//id/45082719

My comments: It is bad to allow speculators to make profit by taking advantage of the misery of other people. This applies not only to hard disk prices, but to oil, food and most other essential products. The speculation should be stopped. The world system, under the control of financial speculators and the greedy banks and based on the "free market", has to be changed - to make a fairer world for the ordinary people.

Security at the airport

The security procedures at Changi airport is excessive and is causing a lot of inconvenience. Here is my experience.

1. On arrival at the airport terminal, I have to screen my bags. Why is this necessary when the bags are also screened at the check-in counter and at the boarding room?  I suspect that this is to prevent a bomb going off before check-in. Is this so important?

2. Before entering the departure hall, I have to show my ticket and passport to the policeman.

3. After going through the automated gates and have my finger printed, there are still people to look at my passport. I recall that this procedure was implemented when someone passed the immigration desk though with a wrong passport. Do we need to over-react to this mistake by introducing another set of check?

4. Before entering the boarding room, I have to go through a detailed screening. The laptop and mobile phones and other metallic objects have to be removed  In spite of removing so many items, it is likely that the metal detector will beep and subject me to a physical check.

5. I still have to show my passport to the staff who scan my ticket.

Altogether, I have to show my passport three times and have my bags scanned twice. I suspect that more requirements will be introduced to combat other security concerns. The question is - are these measures overdone?

In the name of security

In the name of security, we do many unnecessary things and cause a lot of hassle to the ordinary people. This makes life stressful.

Look at the excessive security in the airport. I do not mind the necessary security, but the excessive security does not make sense. I shall talk about some of these excessive measures.

Look at the need to register your particulars before you enter a building. It is a regular affair. Why do they need to spend the time to record people entering into a building? How many records are being kept? Are they of any use? In fact, I am worried that the records could be abused - as it is intrusion on privacy. Is privacy and the rights of the individuals important in Singapore also?

With all the excessive security in some places, why is SMRT not paying sufficient attention to prevent outsiders from entering into their depots? Surely, this is more important than checking all the visitors to a building?

We need to speak up on measures that intrude into our lives, and do not serve a useful purpose.

Investor's guide to investing in gold

http://tankinlian.com/admin/file.aspx?id=587

A friend sent me this guide to investing in gold. Reading through this document, one can see that there are many ways of investing in various types of gold products, but the investor should be careful about selecting the trusted parties, as there is a real risk that some of these products are fraudulent. I know of a product which offers a buyback guarantee, but the investor did not know that he is paying for the gold at 50% higher than its real market value!

A safe way is to invest in gold bullion, but it is a big hassle to store the gold. It may be safer to invest in the Gold ETF (e.g. the ETF managed by SPDR) or to invest in gold futures through a regulated exchange.

Desalination

TIANJIN, China — Towering over the Bohai Sea shoreline on this city’s outskirts, the Beijiang Power and Desalination Plant is a 26-billion-renminbi technical marvel: an ultrahigh-temperature, coal-fired generator with state-of-the-art pollution controls, mated to advanced Israeli equipment that uses its leftover heat to distill seawater into fresh water.


There is but one wrinkle in the $4 billion plant: The desalted water costs twice as much to produce as it sells for. Nevertheless, the owner of the complex, a government-run conglomerate called S.D.I.C., is moving to quadruple the plant’s desalinating capacity, making it China’s largest.


http://www.cnbc.com/id/45042111/

Top 1% are getting richer

NEW YORK (CNNMoney) -- From 1979 to 2007, average household income for the nation's top 1% nearly tripled, while middle-class incomes grew by less than 40%, according to a new report from a research arm of Congress.

While those at the top have seen their incomes soar over the past three decades, middle-class and lower incomes have stagnated, the report by the Congressional Budget Office (CBO) found.

http://money.cnn.com/2011/10/26/news/economy/cbo_income/index.htm?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29

A successful shopping mall in Jakarta

Taman Angrek is a successful shopping maill in Jakarta. It has a large atrium and an indoor skating rink.

How income inequality harms society

http://www.ted.com/talks/richard_wilkinson.html?utm_source=newsletter_weekly_2011-10-25&utm_campaign=newsletter_weekly&utm_medium=email

Singapore fares quick badly on several indicators.

For decades, Richard Wilkinson has studied the social effects of income inequality and how social forces affect health. In The Spirit Level, a book coauthored with Kate Pickett, he lays out reams of statistical evidence that, among developed countries, societies that are more equal – with a smaller income gap between rich and poor -- are happier and healthier than societies with greater disparities in the distribution of wealth.

While poverty has long been recognized as an indicator for such social ills as crime, obesity, teen pregnancy, Wilkinson and Pickett have demonstrated that societal well-being bears no relation to per capita income. They’ve also found that the symptoms of inequality trouble all levels of society. Across the board, mental health, levels of violence and addiction, even life expectancy are affected by the psycho-social stress caused by income gaps and status anxiety.

In the UK, The Spirit Level won support from politicians both left and right. Wilkinson, who is Professor Emeritus of Social Epidemiology at the University of Nottingham, also cofoundedThe Equality Trust, a nonprofit that aims to reduce income inequality by educating and engaging the public while supporting political commitment to address the problem.

He says: "While I'd always assumed that an equal society must score better on social cohesion, I never expected to find such clear differences between existing market economies."

White House studies student loan relief plan

The White House is introducing a student loan relief plan. This will add to the deficit and shows how bad the debt situation has become. Many sectors, including the government, home buyers and students are not able to pay off their debts.

http://www.cnbc.com//id/45037241

Difficult to revive the housing market

This article explains the difficulty faced by the Obama Administration in reviving the housing market in America. If a country allows its property market to build into a big bubble, it will be difficulty to reverse the situation. This is a lesson for Singapore to avoid.

http://www.cnbc.com//id/45021347

Survey - forex training course

If you have attended a forex training course and wish to give your feedback or ask for a refund, please take part in this survey  http://www.surveymonkey.com/s/JS7F7XV

Global Financial Regulator

The Vatican has called for the establishment of a global financial regulator and a tax on financial transactions. It also recognises the excesses, corporate greed and other wrong doing that has been committed in recent years.

http://www.cnbc.com//id/45013499

How to make the PAP work in your favour

Dear Mr. Tan,


In 1993, the retirement age for Singapore workers was raised from 55 to 60, and then in 1999, it was raised again from 60 to 62. Amazingly, during these 18 years (1993-2011), a local university has stubbornly stuck to a retirement age of 55 for their academic staff. Only recently and as a sigh of relief to their staff, the university has finally raised the retirement age from 55 to 62.


Can you imagine what it is like to be forced to retire at 55? During the past 18 years, is it possible that PAP were not aware what this university was doing? With regard to the recent change at the university, could it be to do with the 2011 GE results? So, what could not be changed in 18 years, has now been changed which coincide with six opposition MP in the Parliament. Can you imagine what could happen with more opposition MP?


So, do you know how to make PAP work in your favour?


Retired at 55

Electronic Health Records - advantages

There are advantages for consumers in storing their medical records online. There are some concerns about privacy, but these concerns can be overcome when consumers understand how the system works. The best way to to give it a try and experience the benefits.
http://tankinlian.com/admin/file.aspx?id=586

Top up CPF savings

Here are 3 reasons to top up CPF savings and some tips on choosing between the retirement account and CPF Life. To enjoy the tax savings, the top up has to be done before the end of the year.


http://tankinlian.com/admin/file.aspx?id=584&PK=6a9035fe4e91102f8aebde1ae83d78a1

Singaporeans are reluctant to protest

Signaporeans are reluctant to protest. They generally do not care, if some bad things happen to other people. When it happens to them, they find that the other Singaporeans do not care.

http://singaporemind.blogspot.com/2011/10/singapore-leads-occupy-rally-reluctance.html

Singaporeans should read and understand the meaning behind this story, "First they came for the Socialists" ....
hhttp://www.ushmm.org/wlc/en/article.php?ModuleId=10007392

Top 40 blue chips in Singapore

This table shows the top 40 blue chips traded in the Singapore Exchange. Of special interest are the drop in price from the recent high dividend yield and a stockbroker's forecast of the EPS (earning per share) and PER (price earning ratio for the next two years. These figures should be treated with caution. The stockbroker's recommendation has been removed. Before investing in any share, you should consult your stock broker.
http://tankinlian.com/admin/file.aspx?id=583&PK=6e4c42184de0102f8aebde1ae83d78a1

Investing in a troubled world

Given the uncertainty in the global financial and economic environment, how should ordinary people invest their long term savings to earn an adequate income and to cope with the higher rate of inflation expected in the next few years?

This is the question asked by many people. I like to give my views.

http://tankinlian.com/admin/file.aspx?id=582&PK=b608b34c4da6102f8aebde1ae83d78a1

Haircut on Greek Debt

Private investors will be asked to take a 60% haircut on their investments in Greek bonds. This is much higher than the 21% agreed in August. I expect that the final figure will probably be 40% to 50%.

http://www.cnbc.com//id/44992798

The question is - why are the European banks holding so much Greek bonds? Surely, the jobs of banks should be to provide banking services and give loans to businesses. They should not be an investment fund, using their money (taken from the Central Bank or credit creation) to speculate on this type of investments or to fund foreign governments?

And why is Greece, a country, not able to meet its obligations? Surely, the Government has assets that can be sold - to repay the debts? If Greece is allowed to get away with 60% of its obligations - what about other countries? This will set a bad precedent. Many countries will continue to be bad risks. What about USA? We can expect an uncertain future and more volatility! And the structure of the financial world will be quite different.

The answer to these questions are - there is something seriously wrong with the financial structure of our global system. Our financial system is based on the illusion of market values and is fed by greed, speculation and corruption.
  

Pay of Government Leaders

This table shows the pay of Government leaders, compared to GDP
http://sg.finance.yahoo.com/news/Top-10-Highest-Paid-investopedia-1388928230.html?x=0

Invest in an indexed fund

When you invest for the long term, invest in an index fund (such as an ETF that is based on a market index) and stop trying to pick the stocks to beat the market. There are a few other good tips in this article.

http://money.cnn.com/2011/10/21/pf/expert/investment_returns.moneymag/index.htm?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29

Learn how to invest in an indexed fund. Attend the financial planning workshop organised by FISCA on 29 October. http://easyapps.sg/assn/Org/Event.aspx?id=5

Medicare in USA

The problem with Medicare in USA (i.e. the health care paid by the Government for retirees) is that it becomes very costly to give the best to the older people and the Government is bearing the cost. In Singapore, the Government wants the people to bear the cost - and they cannot afford it either. The solution? Educate people on what is necessary and what is wasteful and help them to find the right treatment at a cost that they can afford. 

http://money.cnn.com/2011/10/11/pf/medicare_programs.moneymag/index.htm?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29

Small child who was street smart

A 2 year old girl, Yue Yue, was run over twice in Guangzhou, China. Many people passing by did not help her. Where were her parents?

I recall a horrifying experience some 20 years ago, also in Guangzhou. I stopped at a small town for dinner. After dinner, I was returning to the bus. I saw a small boy, also about 2 years old, on the opposite side trying to cross a busy road with many fast passing vehicles. There was no adults around to take care of the child. I was horrified that he could be hit by a passing vehicle, but there was nothing that I could do, as I was on the other side of a busy road.

After a while, the little boy saw a gap among the vehicles and run across the road safely to her parents who were nearby. I then realised that this boy, although very small, was street smart. He must have crossed the road many times safely. His parents knew that he could take care of himself.

This is so different from the over-protected children in Singapore!

New approach towards new media

The Government is likely to take a new approach and a more active approach towards the new media.
http://newasiarepublic.com/?p=33833

I have seen the bad side of the new media and how people can act irresponsibly when giving their comments (and untruths) and malicious attacks under anonymity. I like to see the new media being used in a more responsible manner and will welcome moves in that direction.

Subsidy for Japanese manufacturers

The Japanese government is introducing a subsidy to help its manufacturers to keep their production in Japan, in the face of a stronger currency. This shows that the system of free trade and open market is now under stress. http://www.cnbc.com//id/44983686

Communist Manifesto - 1848

I read some parts of the book by Karl Marx entitled the Communist Manifesto. He described the struggle between the proletariat (working class) and the bourgeois (capital owners). Today, 163 years later, it is a struggle between the 99% (ordinary people) and the 1% (elite). This can be seen in the "Occupy Wall Street" protest.

National Service Deferment

The Minister for Defence said that there was no preference treatment for National Service deferment. He explained in detail to Parliament how the process for deferment was carried out. However, the newspaper report did not carry the details. I hope that our MPs in Parliament would question the process, to ensure that the relevant questions have been asked and answered satisfactorily.

http://www.straitstimes.com/Parliament/Story/STIStory_725378.html

My preference is for National Service to be made fairer to male citizens, so that they do not need to sacrifice their time and opportunity. This can be done through reducing the duration of national service and/ or compensating them adequately for the time that they have to spend. The Singapore males have to compete with foreigners and females in the job market and should not be placed at a disadvantage.

List of contractors

The list of contractors have been updated to include plumbing, electrical and TV repair. There are now 13 categories of contractors. This list will be converted into a database for easy access at a later date. The contractors have been contacted to establish their responsiveness to calls or emails.
http://tankinlian.com/admin/file.aspx?id=579

Top-up CPF by cash

The charge (by eNETS) to top up a CPF by internet banking is too high. For an amount of $1,000, the charge is $15. For a larger amount, the charge is NOT specified.

To avoid this excessive charge, I decided to pay by cheque ($0.25 for postage). But I have to write a lot of detail at the bank of the cheque including an unweildly transaction number. See below.

This is not the only thing that I have to write. I still have to write the cheque and make sure that the amount in words and letters are correct, the date is correct, the payee is correct. I also have to make sure that the address of CPF is correctly written on the envelope.  This is a sad part of life in Singapore - so much hassle and over-charging.

Top-up CPF account

CPF took an advertisement to advice members to top-up their CPF account (for themselves and their family members). I responded and tried to do it at their website. My experience is shown in this report, which I sent to the Ministry of Manpower. My findings:

1. The CPF online process has bugs.
2. The administration charge is too high.

I hope that our Government will wake up and sort out the shortcomings and over-charging!

http://tankinlian.com/admin/file.aspx?id=581

Large bonus to bankers

Goldman Sachs pays large bonuses to its employees, in spite of making a loss for its shareholders. The amount of bonus is described as "ridiculous". http://money.cnn.com/2011/10/20/news/economy/goldman_sachs_occupy_wall_street/index.htm?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29

Too many investment choices

This article explains about the difficulty faced by consumers in investing their money, when they have too many choices. http://money.cnn.com/2011/10/20/pf/expert/401k_retirement.moneymag/index.htm?section=money_topstories&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_topstories+%28Top+Stories%29

My recommendation is for most consumers, who are not financially experienced, to invest in an indexed fund, such as the Straits Times Index Exchange Traded Fund. If you are financially experienced, you can make your own choice, i.e. DIY (do it yourself).

Sharing of medical records

There is law in USA regarding the rights of patients for access to their medical records and the duty of the health care providers to protect privacy of these records. We need similar laws in Singapore. http://www.tankinlian.com/Redirect.aspx?PK=2c77701b4c43102f8aebde1ae83d78a1   

Electronic Health Records

Medical costs have been escalating for the past few decades. As people get older, they have to spend more on health care. The experts have identified ways to improve the efficiency of health care and to cut down on wastage. They have suggested that electronic medical records of each person, that is available to their doctors can cut down on repeated tests.

President Obama actively proposed the creation of a central system to keep the health records. Google launched its innovative Google Health system to meet this need. But Google has decided to scrap this system, due to insufficient interest to use it. It seems that electronic medical record will not take off, at least for the immediate future.

What is the problem? If escalating health care cost has to be contained, why did these initiatives fail? Why are people reluctant to use electronic health records - which can help to improve efficiency and bring down cost?

Which of these factors are most important?

1) Doctors want to keep control of the records, so that the patients will keep going back to them
2) The Government failed to pass the law to give political support to these measures
3) Patients are reluctant to have their health records kept electronically
4) Consumers are weak in enforcing their rights and interest.

Please share  your views here.

Financial Planning Test

Take this test and find out how much you really know:
http://tankinlian.com/admin/file.aspx?id=458

You can register for the financial planning workshop to be held soon:
 http://easyapps.sg/assn/Org/Event.aspx?id=5

Problem with big audit firms

There are problems with big audit firms - not only in America but also with the China firms. This could lead to another source of issue between America and China. But the problem of auditing in a world of greed and accounting fraud is more widespread. http://www.cnbc.com//id/44967737

Solar energy industry

America is counting on solar energy industry to create jobs. Already, they are facing strong competition from China. http://www.cnbc.com//id/44968075. This may lead to trade disputes.

Self help group for Singaporeans to find jobs

Dear Mr Tan,
We are a group of Native Singaporeans self help group.

We aim to help jobless Native Singaporeans to look for employers who support Native hirings as many are fed up competing jobs with younger, faster and cheaper new immigrants.

We understand you have an opening for the above which we can help you to advertise on our FB page to attract our interested members.

Please Add Friend and take a look at our FB info, wall and pages. Appreciate you can spread the word around.

http://www.facebook.com/#!/profile.php?id=100002910723487
https://www.facebook.com/#!/pages/True-Blue-Job-Business-Opportunities/298500870176141

Drop in standard of living

This article describes what has happened in America. It reflects the situation for many people in Singapore as well. When there is a widening gap in income, the high cost of living must squeeze those on stagnant wages.

Contractors for various services

Here are contractors for various types of services. They have a website and respond quite promptly to telephone calls or e-mails. We are not able to judge their prices or quality of service.  You have to make your own judgement when you call them.
http://tankinlian.com/admin/file.aspx?id=579

Ban on naked CDS

The European Union has decided to impose a ban on naked CDS - i.e. betting on the default of a sovereign government where there is no existing risk to be covered. They have decided that this type of betting is harmful to their economy. It is a recognition that these financial products are designed mainly for betting, and cause harm rather than good.

Temasek Convertible Bond - Standard Chartered Bank

Temasek Holdings offers a 3 year zero-coupon bond that can be exchanged into shares of Standard Chartered Bank at a premium of 27%. Is this a good investment? Here is my view.

Here is another person's view.

Employment rate of Singaporeans

Quote from Lucky Tan: For many years, the PAP govt has tried to paint a rosy picture to Singaporeans on employment when the real situation on the ground has deteriorated badly especially among older Singaporeans.

Thoughts of a contented Singaporean who has lived in Singapore for 40 years.

Read his article: http://singaporemind.blogspot.com/2011/10/unemployment-truththe-real-statistics.html

Booking an air ticket

I went to the Sri Lanka Airline website to book my air ticket to Colombo. I found this website to be well designed and easy to use  - much better than Jetstar or Singapore Airlines. I got a good price. I asked my travel agent if they are able to match this price - but they cannot. I went to Expedia.com but could not find a comparable price (but the price was a good benchmark). It seemed that the best price can be obtained by booking directly with the airline.

  

Real estate agents

There were 1,200 complaints against real estate agents for the first 9 months, or 5 each working day. The total fees paid for the transactions was $1.25 billion last year, or an average of $37,800 per registered agent (based on 33,000 registered agents, including those that are only partially active). http://www.channelnewsasia.com/stories/singaporelocalnews/view/1160085/1/.html

Improve your vocabulary with Word Power

This app allows you to improve your vocabulary. It runs on the iPhone and iPad. You can unscramble the letters to form the correct word that match the definition. It is suitable for children and adults. It has different levels of difficulty based on the number of letters in the word.

Consumers deserve to be treated fairly

This article explains what the regulators in USA are doing to ensure that consumers are protected fairly in the bills that they receive from their telephone companies. I believe that the regulator in Singapore (IDA) has already implemented similar measures - but I am not sure if they have done to the same extent as in the USA.

Bright Jigsaw

This video shows Vera and her friends trying out the Bright Jigsaw, a new app that will appear soon in iPhone and iPad. You can choose several images and break down the images into a number of small pieces from 3X3 to 8X8. It is challenging and fun and suitable for children and adults.

New Yorkers support the Occupy Wall Street Protests

They like tougher regulations on the banks and support the right of the protesters to demonstrate, so long as they obey the law. See this report.