Loss of SGD 70 trillion in 2008

The world suffered a loss of SGD 70 trillion in 2008. This is the drop in asset values in all the markets around the world. Prior to this drop, the world had assets of probably between $150 to $200 trillion. Is the world really poorer now, compared to 2007? Were the assets destroyed?

The same assets (i.e. businesses, hotels, properties) were still around. They are now partly unutilised, due to the drop in consumer demand, but in terms of physical quality, they are not impaired. In this case, why should they be considered as losing one third to half of their value?

This is a weakness of the free market system that formed the foundation of the economic system that has now collapsed. By depreciating the value of these assets to this extent, the world does not become better. In fact, it becomes worse when the values keep wpiralling downwards. People react to this situation by cutting down on their speding, making matters worse for the wider economy.

To solve this problem, we must give people the confidence to continue spending as before. This will generate demand, which will create employment, help to pay for the mortgage on their homes.

A possible solution: give people access to personal credit (especially if they lose their jobs or suffer a drop in earnings).

SCMP:Investment complaints for SFC

The Monetary Authority has referred to the Securities and Futures Commission seven complaints regarding a licensed bank’s promotion of Lehman Brothers investment products, to decide whether follow-up action is needed. The authority has received 20,345 complaints so far about the Lehman Brothers products and is investigating 4,876 cases.

SCMP:Minibond blame for government

About 60 per cent of respondents to a Civic Party survey said the government had to share responsibility for the minibonds saga. Of 1,000 respondents, 72 per cent said the Monetary Authority and Securities and Futures Commission failed to make full reports of their bank investigations.

WSJ: Sands President Abruptly Resigns

Read this report. This resignation may cause problem with Marina Bay Sands.

Minibond Investors

There are two groups coordinating the Minibond investors:

a) Group 1 (Minibond Victims Group) coordinates the investors who bought from the banks
website

b) Group 2 (Minibond Investors Action Group) cooridnates the investors who bought mainly (but not exclusively) from the brokerages.

Group 2 wish to inform the investors about their website, as follows:
http://www.miagsg.com/

I wish to advise investors to study the approach taken by the two groups and to decide which group suit your interest better.