This has been a week of eye-opening news and reality checks … if only the eyes of those that matter and the reality of those it affects understood what they were reading …
NEWS, VIEWS & OVERDUES
Now, after so many months of tanking and losses in the financial markets, now after a brilliant mini bull run in these same markets since March this year, now that people are believing that the worse is over, broad hints that more downside is coming has finally surfaced … albeit, too late. It’s too late because the masses have already bought into what they read, believing that the bottom was indeed in Feb/Mar 2009 and that the past month’s rally was all about you missing the boat.
For someone to get rich, someone else has to pay. Most of the time, a few get rich while a lot get poorer. You can say that it is because only a few are smart enough to capitalize on the situation. But I believe that it is because most are ignorant and choose to listen and believe everything they read and hear – it is called Herd Instinct.
News has been a great mechanism for those who know how to use it to make great gains in a time of general weakness, in a time when people are looking for any good news for any hope. News has become a leverage tool rather than an information dissemination vehicle. And when news really matters, all we get is a filtered version of it so that fear is not sold up in abundance. News today is all about what some people want other people to hear instead of what everyone should know.
SHARE-LOSS SHARING
Without getting controversial and without finger pointing and blaming …
Now we get the final answer … Aunty is going to get her compensation after all. Everyone who invested and lost on Lehman Minibonds and other toxic products are going to get some money back (as deemed deserving by an overseeing body). I am truly happy for them.
And I am also so very happy to be contributing to their compensation (not that I had any say about it). I hope these beneficiaries (the word now plays up more significance than ever before – benefit) remember what the taxpayers and bank share-holders have done for them and that they remember us when they make some money on their next investments … I would like to get some of my contributions back.
No … wait, that can’t happen, … not because the channels are wrong but because these beneficiaries are going to jump into the next high risk investment that comes their way because in another worse-case-scenario, they are going to get their money back by crying all over again! After all, the form claimed that it was 100% capital protected … now I know what that means! Eureka!
Hmmm … I wonder if the American bail-out plan was designed along these lines … hmmm …
FYI, your bank deposits are still safe … the guarantee only expires on 31 December 2010. Do you know what happens to your money after 31 December 2010? Have you any idea about the kind of liability you are up against after that date? It will not surprise me if you didn’t because they don’t talk about these things openly.
AWARE WITHOUT AWARENESS
I was strangely happy to read that the ST School Pocket Money Fund needed much more money to survive this crisis … not happy that they needed more money but happy that Adam Khoo, Ryan Huang and myself had picked the right charity to donate our proceeds from “Profit From The Panic” to. It was heartening to know that we did the right thing.
It was disheartening, however, to see a bunch of women squabbling for power, turning a noble organization into a squared circle for a public political slugfest to prove who was right and who was wrong. What happened to democracy, justice and equality for a happy, prosperous and progressive nation?
We get enough of that kind of bickering in the U.S. between the democrats and republicans – where in my opinion, their stance is based on the face, pride and values of their party and not the greater good of the American in the street. Their political posturing is for the good of their political careers and not the careers of their constituents.
If recent weeks’ activities within AWARE are any indication of how our organizations, and possibly, our government are going to be run, I shudder to think where Singapore is headed when my grandchildren are born. We only have to look at the U.S. to see where such idealogy and selfishness has led them.
AWARE has a vital position now in our history … it either does the right thing to set the right precedence or screws up big time by keeping opinions selfish and self-serving. This precedence will prove what kind of society we have bred and what kind of society our children are about to face. I will groom my children accordingly to make sure they survive in those conditions, whether it is ethical, moral or justifiable or not. We can’t be moral and ethical and teach our children to be moral and ethical if we first cannot survive for losing to those who aren’t.
It’s up to you, women of AWARE. Our selfless donations to the STSPMF are to help our children get educated and grow up aware of the society we are building and grooming. Do the right thing now because it’s the right thing to do.
FYI, the other organization that we contributed to is AIDHA.
RECKLESS & IRRESPONSIBLE INSURANCE POLICIES
A truck overtakes an SUV on the inside (left) and cuts into the SUV’s lane while traffic is at a crawl. The SUV brakes hard to avoid the collision but the truck has left no space for allowance and drags its rear over the front left of the SUV and leaves a deep gash and dent in the SUV. Rather than stop, the truck speeds off. The SUV catches up with the truck and forces it to a stop. The lady driver of the SUV confronts the male truck driver only to get abused by the aggressive truck driver. He gets back into his truck and drives off without as much as leaving his apology behind.
The lady makes a police report immediately and reports the incident to her insurance company, as is expected. But it takes weeks to get any response or guidance as to where the claim or the case is heading.
The lady then discovers that the truck driver did not make any claims nor report to the police and as such, she is powerless to do anything. Her claims for her damaged car is about to be pointless. It became apparent that if the truck driver claims that this incident never happened, the lady is going to have to pay for the repairs herself or take it to court for a long-drawn and expensive legal battle which will surely cost more than the repairs itself.
Such is the state of our road policies today. Our road rules no longer protect the innocent but encourages recklessness and irresponsible behavior because accountability is no longer a legal factor. You can break the law and as long as you don’t get caught or deny that it ever happen, you are likely to go scot free without even a wrist slap. Maybe that is why driving on our local roads is getting more and more hazardous to your health and your vehicle’s well being. The police are leaving minor accidents to be settled privately and as a result, we get inflated insurance claims or claims that go null and void.
In short, if you’re ever in an accident and you are obviously at fault, don’t do anything and you’ll get away with it. Just go and quietly repair your vehicle at your own cost and you won’t have to worry about the repair costs of the other party.
The stupidity and ignorance of this kind of thinking is that neither party needs to fork out a cent if both parties tell it like it is. Both parties will get their respective cars fixed at no cost to their wallets. That is what insurance is about. There is a small downside in that the wrong party will have slightly higher insurance premiums in the future. But the higher premium is still cheaper than paying for your own repairs.
This is a real case and the lady in this case is my wife. After 3 months of driving around in a damaged car and waiting another 2 months to know whether or not we would have any chance of getting our claims, we finally got everything done without the need for expensive lawyers and extended court hearings. The case was expertly handled and settled by the superb staff at Borneo/Champion Motors.
Rather than just sell insurance, firms need to educate the buyer about the responsibilities and advantages of having insurance. But alas, if they do, then everyone would claim upon every accident and the firm will surely not benefit from that as opposed to the current ignorant situation.
But what is disturbing is that the police did nothing about the obvious hit-and-run and road-rage complaint that my wife reported. Surely those two misdemenours are criminal or at best, against the law and chargeable offenses. It is really becoming a case of “you can do anything as long as you don’t get caught” … I much preferred Singapore when it was a “fine” country.
SPIT SPAT
Still along the subject of a “fine” country … Singapore is becoming a cesspool of selfish and uncaring people. And the one leading indicator of this trend is the growing bad habit of spitting. Why it is a leading indicator is because, surprisingly, it is not just some of the elderly who are guilty of it but more significantly, the teenagers and early adults are doing it more.
It could be because they see Beckham, Gerrard, Ronaldo and company doing it on the field every week on international TV/Cable so it must be a trendy thing. Whatever the reason, it’s disgusting and worse, nothing is being done to curb it.
I would like to express a personal thought here … smokers outside a yellow box pose less of a health threat than a population of rampant spitters in a time of Swine Flu. Yet it would seem that the smokers get fined more frequently than spitters (This is from here-say – I hear of more cigarette offenders than spitting offenders). And from my observation, there are more spittle spots in Bedok North than indiscriminately discarded cigarette stubs.
Check out my elevator … I never see a cigarette stub in there but there is always at least three spots of fresh dribble. (At least the urinating stopped!)
Instead of insisting on kindness, maybe we should focus on conscientiousness … FYI, it means “giving a damn“.
PROPERTY PLUNDER, REAL-TY BLUNDER
So we read that property sales in January, February and March of 2009 were blow-out numbers and in April, more people ran out and bought new developments at between S$750 to S$1,000 psf. And now that most of the properties have sold to the point that the developers are safely profitable, the real news emerges.
In a previous posting, I was bearish on property prices saying that if a house was worth $1,000,000 at the peak of 2007, I would only be interested in purchasing it at $600,000 by September 2009 or thereafter. Between Q4 2007 and Q3 2008, I mentioned to hundreds of Wealth students that I expected a 20% discount from that 2007 peak by the Q2 of 2009 … I almost have it; landed property is down 15.5% from the 2007 peak as of end Q1 2009.
Now let me show you how media language works when used for statistical purposes;
Record Sales for Q1 vs Spiraling Prices since 2007
Record Sales get people excited and hyped up. “If everybody is buying, then I must be missing the boat.”
Spiraling Prices does not make Record Sales a lie. But what it does mean is that more people are buying homes as prices are falling – a.k.a. Buy Low, Sell Lower if the market stays down.
Such divergent reports are kept apart so that the obvious isn’t so obvious. The pattern is a repeat of what happened at the peak of 1996. Buyers then are still holding on to properties today that have lost value.
The real news (not the one about record sales) is that prices have been spiraling and rents have been falling … and they continue to do so and are expected to fall further for the first half of this year. That was in a Saturday 25 April report in ST. In another report two days earlier on Thursday 23 April, recovery of the property market was only expected after mid 2010 and only if the stock market recovered first. In its first paragraph, it mentioned that “buyers snapping up homes in recent weeks may be jumping into the market way before it has reached the bottom.” This was according to new research. This report comes after all that hype for several new project launches as mentioned 2 paragraphs above.
Buy the rumor, sell the news.
I’m still shopping but I am in no hurry. Reason is simple … to quote a small item in the Thursday report (that could easily have gone unnoticed) …
It has been observed that the Straits Times Index has, since 1993, been leading the Urban Redevelopment Authority’s non-landed residential price index by one to four quarters.
Historically, the level of unsold stock – which has risen to around 21,000 units since the third quarter of 2007 – has preceded the property market price recovery by two to 12 quarters …
“Two to 12 quarters”!! That six months to three years! That’s worse than me calling a market rally between now and 2020!
CHAN AGAINST CHINA – CHALLENGING CHANGES
I much preferred our country under the rule of LKY. The man kicked ass and this nation was a proud, clean and organized one under those very trying circumstances. Not that I have anything against more freedom and a relaxation of certain laws but I don’t think our society is ready for such luxuries yet. And we shouldn’t be in a hurry to get it either especially not when we are turning this island into a nation of migrants and foreign workers.
Jackie Chan said it best when he lamblasted Taiwan and Hong Kong for being “chaotic”. Of course the Taiwanese condemned what he said but you only need to look into their parliament house to see how right Jackie is – disputes are settled with fist-fights!
You don’t have to go far back to know that Jackie is right about not allowing too much freedom in China too soon and too quickly. When the Eastern Bloc broke down and Communism gave way to Freedom, it was like releasing life-imprisoned males into a Victoria Secrets launch party. All hell broke loose, organized crime took control, newly installed governments were corrupt from the get-go and its citizens bore the brunt of all this confusion. Infrastructure never took off, poverty reigned supreme and the poor got victimized.
Now imagine a China in those circumstances. For democracy and freedom to work in China, they are going to need LKY’s kick-ass approach and it has got to be on a grander scale. But in all honesty and in my opinion, it won’t work. They can’t even organize Taiwan without having to invade them. LKY took 30 years to make this country of 4 million into what it is. How long will it take 1.3 billion Chinese to adapt?
And even with KLY’s approach, we’re still spitting and driving recklessly.
China’s problems are starting to pile. Their one child policy is starting to blow up in their faces as more males stare at less indigenous females. I seriously wonder how that is going to play up in the near future. Their business policies which center largely on selling is hurting really badly now because no one is buying near as much as the Chinese require to sell. With America’s economy concentrating on itself and aiming to contain their debt, trade with China is slowing. America’s concentration on the current crisis is so focused that Iraq, North Korea and Iran are tiny blips on their scopes when once upon a different time, they would have made a meal out of each one of them.
China was once on the brink of world domination. Its dismantling of one of the most significant naval fleets was a really bad political move at a time when the Portuguese, Dutch and British empires were about to embark on their quest for world domination. If history has a habit of repeating itself, will China, with worldly opportunities at its mercy now, throw away the chance to rule and dominate yet again? If they want freedom, then the answer is “yes”, they will screw up again.
What is freedom worth anyway? If America is any indication of that “dream”, then China will be better off considering another approach to government, assuming China is tired of communism. (After all, their government model is no longer based on hard-core communism anymore, is it.) All the American Dream did for its country was make individuals greedy and self-serving and all that did was lead it to self destruction. And now that the damage is so bad, it would seem that America still hasn’t learnt its lesson and continues on its self-destructive path. The damage continues to pile up for the next generation to fix.
PANDEMIC EPIDEMIC
Didn’t I write somewhere on this blog that three things normally accompany a recession?
- Pandemic
- Natural Disasters on a national/international scale
- War
Well, one down, two to go.
[posted by Conrad]
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