Monday, January 10, 2011

Editorial of SGEP

whe editorial of SGEP contains an interesting summary of the articles that are posted in the portal. These articles are extracted from the media and blogs. It gives the readers an interesting summary of the key issues that they have to consider at the General Election of Singapore. Do read SGEP daily.

Who is handicapped?

Here is an interesting story about life.

A terrible place - Singapore

Singapore is a terrible place to do business. I have to pay $3,500 to a professional engineer to certify that the renovation to my office meets "fire safety standards". This is a ransom fee for a simple piece of work, but I paid. My appointed contractor had to get the stamp from the professional engineer and to apply for a permit from the management office (of the developer) before he can start work. After wasting time for more than three weeks, the contractor still cannot start work. Meanwhile, time is running out, as I have to vacate my current office.

Besides paying a big ransom, I have to suffer a long delay. I had written to the Pro-Enterprise Panel on this matter. They replied that they were consuling the relevant department but did not come back with a reply after several weeks. Is this just for show?

Tan Kin Lian

Avoid investment that you do not understand

Dear Sir
My insurance agent has changed line and another agent is in charge of my policies right now. He has been pestering me to stop my endowment policy, to cash out the coupons and to put the monthly premium into a global savings account. At the same time, he encouraged us to leave whatever premiums that I've paid (approx 8 years) in the policy and let the policy run.
1) He claimed the global savings account can generate at least 20% every year
2) he claimed although I am to stop paying the monthly premium, my coverage will be the same and will still continue. I would also be able to draw up some cash at the end of the tenor, ie, 21 years. 
Is he to be trusted? Can I know what is a global savings account and what he claimed in point 2 is true?


REPLY
My advice is to avoid any investment that you do not understand and never to accept promise of high yield (which is not guaranteed). Read my book on financial planning to learn about why you should avoid these types of products (where a large sum is deducted from your savings to pay commission to the agent) and leave you a poor yield. My book also advice you on how you can invest your savings for the long term to get a good yield.

Author of “Wisdom on How to Live Life” on Radio 938LIVE

Dr. Tommy Wong, author of “Wisdom on How to Live Life”, will be interviewed on the 938LIVE programme “The Living Room” on Wednesday, 12 January 2011 at 10 am. The books are currently on promotion and can be ordered here.

Measures to control internet cheating

Most people receive e-mails regularly from people who are out to scam. They are usually from overseas and purport to have some money in some bank account which can be withdrawn. It happens a few times each day.  The message keeps changing, but follows a pattern.

While most people will ignore these messages, there will be a small percentage, say 1% of 1% that may fall for the trick. And they will be cheated. The government will say that there is nothing that they can do to stop this massive scamming. People should be smarter and avoid these scams.

I do not agree with the approach of the government on this matter (and I am referring to not just the Singapore government but governments in other countries as well). The law should make it clear that cheating and fraud is a crime and that criminals will be prosecuted. It may not be possible for the government to catch the criminals if they are overseas, but I do expect the government to put in some resources to do what is possible.

Here are some possible things that can be done:

  • Trace the location of the sender
  • Have a sting operation to catch the criminal
  • Tell the ISPs to help and spam back to the spammers
These actions do not cost much. It only takes a responsible government who is willing to do their duty and pass a message that scams and frauds are not tolerated.

Tan Kin Lian

Closure of spas in Singapore

Hi Sir,
Thank you for posting updates on your blog for the information of your readers. Wikipedia has now published a page on the Spa closures in Singapore, a topic which prompted fierce online responses in numerous forums and a discussion in the Parliament.
http://en.wikipedia.org/wiki/Spa_closures_in_Singapore


I hope the politicians will address the issue of how come the government or law system in Singapore allows unethical directors of businesses to take advance payments from huge number of people and are continued to be protected by the corporate veil/the concept of the separate legal entity.

Spa Victim

Bursting of the bubble [2]

Dear Mr Tan,
Thanks for your blog and sharing the tips on “How to survive the bursting of the bubble”. It has been helpful in many ways. I agree with you on the bubble. The current property anti-speculation measures has certain overlap with those introduced in 1996. This link  from REDAS shows the significant events and historical property price index of the past from 1960 to 2006.
The Asian Financial Crisis in July 1997 is somewhat triggered by inflow of “hot money” targeted at the currency. Nevertheless, China is preparing to combat the inflow of “hot money” 

However, as much as anti-speculation policies can be introduced, all it takes is just a significant event to trigger any short selling such as when the South Korea went ahead with the military drill despite threats of North Korea

I have currently more than S$100k invested in Singapore and HongKong shares of which the values have appreciated from the time which is bought many years ago. The plan is to slowly sell it probably from Feb 2011 onwards to the period of Singapore general election date and wish to seek your advice on the timing.


REPLY
I am not able to give timing advice. But in general, it is better to get out of the market when it is high, and not wait for it to go higher. Wish you all the best.