Sunday, September 20, 2009
Bankers returning to bad old ways
It is quite sad that bankers are returning to the bad old ways - high pay and bonuses, when many people have lost their jobs and are struggling. I hope that the government leaders will be able to put things right. Read this article by Paul Krugman.
Views on Financial Planning book
Mr Tan
Thank you for all the efforts you have put in. As a layman,we sure to learn more about financial planning and investment through your books. All contents should be put in simple form to make a layman like me to keep on reading your books. I looking forward for your oter incompleted chapters. After reading your view in CPF Life, I now more confident to help my parents to take up this plan.
Thank you for all the efforts you have put in. As a layman,we sure to learn more about financial planning and investment through your books. All contents should be put in simple form to make a layman like me to keep on reading your books. I looking forward for your oter incompleted chapters. After reading your view in CPF Life, I now more confident to help my parents to take up this plan.
NOTE
About half the people like the simple format of the book. The other half likes it to be more substantial and in depth. I will be changing the content to be "more in depth". The next version will be quite different from draft 4.
Is the automated vehicle safe?
It should be quite safe. Read my views here. I am visiting France to see the Cycab in operation.
Shape Quiz
What is the origin of the shape quiz? How is it suitable for children, adults and seniors? Find out here: http://www.tankinlian.com/puzzles/shapes.html
Clubs for the jobless in America
I admire the ingenuity of the Americans in creating products to meet the needs of the day. Read about the job clubs here.
Learning from facts, not beliefs
The Straits Times has an article by our Finance Minister Tharman entitled "Learning from facts, not beliefs".
The Minster said that the global crisis is caused by "failure of regulations premised by beliefs that were not supported by facts", in particular the "faith in self-correcting markets". He argued that the government has a duty to intervene to stop asset bubbles from growing to an unsupportable level.
The Minster said that the global crisis is caused by "failure of regulations premised by beliefs that were not supported by facts", in particular the "faith in self-correcting markets". He argued that the government has a duty to intervene to stop asset bubbles from growing to an unsupportable level.
I agree.
There is another big market failure that has not been recognised in the paper - the failure to provide transparent and fair information to consumers. The sellers have more information than the buyers and can mislead the buyers into paying an inflated price that is far more than what the product is worth.
This is the modus operandi of land banking and structured products (e.g. capital guaranteed, linked products, dual currency products, high cost life insurance products) that were created by financial experts for sale on unfair terms to consumers (but generate high profit margin to the issuer). The sale of new property launches at unjustified high prices is also premised on the insufficient information available to consumers.
It is important that the regulation should also focus on providing transparent and fair information to consumers. FISCA will play a role by creating a white list of financial products.
I have build a website at www.easysearch.sg (Real Estate Data) that makes it easy for consumers to get information on properties. I urge consumers to do your research before jumping into making million dollar purchases that will tie you down for a lifetime.
Tan Kin Lian
There is another big market failure that has not been recognised in the paper - the failure to provide transparent and fair information to consumers. The sellers have more information than the buyers and can mislead the buyers into paying an inflated price that is far more than what the product is worth.
This is the modus operandi of land banking and structured products (e.g. capital guaranteed, linked products, dual currency products, high cost life insurance products) that were created by financial experts for sale on unfair terms to consumers (but generate high profit margin to the issuer). The sale of new property launches at unjustified high prices is also premised on the insufficient information available to consumers.
It is important that the regulation should also focus on providing transparent and fair information to consumers. FISCA will play a role by creating a white list of financial products.
I have build a website at www.easysearch.sg (Real Estate Data) that makes it easy for consumers to get information on properties. I urge consumers to do your research before jumping into making million dollar purchases that will tie you down for a lifetime.
Tan Kin Lian
FISCA - Verification of Financial products
FISCA wish to look for volunteers to help consumers to verify the financial products (including insurance policies) that they have bought.
The consumer will be asked to state what they have been informed about the product and the materials that were provided.
The volunteer (who must have the required certificate in insurance or investments) will check through the materials to explain if the verbal representations correspond with the written materials.
The volunteer will also point out if there are other facts (such as high upfront charges) contained in the materials that were not explained to the consumer.
If there was mis-representation or failure to provide satisfaction explanation by the person who sold the product, the volunteer will help the consumer to write a complaint to the relevant body. The admin fee will be $50.
If you are interested to be a volunteer, please write to kinlian@gmail.com.
The consumer will be asked to state what they have been informed about the product and the materials that were provided.
The volunteer (who must have the required certificate in insurance or investments) will check through the materials to explain if the verbal representations correspond with the written materials.
The volunteer will also point out if there are other facts (such as high upfront charges) contained in the materials that were not explained to the consumer.
If there was mis-representation or failure to provide satisfaction explanation by the person who sold the product, the volunteer will help the consumer to write a complaint to the relevant body. The admin fee will be $50.
If you are interested to be a volunteer, please write to kinlian@gmail.com.
Using subsidised wards (B2)
There are two big advantages of using subsidised wards (B2)
a) You get a subsidy of 50% to 65% of the hospital bill
b) As the government is paying a large part of the bill, they will check that the bill is reasonable.
If the patient has to pay 100% of the bill (i.e no subsidy), there is a risk that the hospital may charge more, or give more treatment than necessary. You have to pay 100% of a larger bill.
I estimate that a bill from a private hospital could be 3 times of the subsidised bill, for the same treatment.
Some people said that the doctors treating patients in subsidised wards are under training and not experienced. I do not agree with this comment. It may be true that the doctors are under training, but they do the routine medical checks and are supervised by the experienced doctors.
When it comes to surgery or other major procedures, an experienced specialist will carry out the procedure. There is really no need for the patient to choose his own doctor.
However, if the patient is willing to pay a higher bill to be treated in a private hospitals or A class ward, and enjoy the privilege to choose their own doctor, it is all right. They can also buy insurance for the more expensive treatment, but the cost of the insurance can be three times.
Tan Kin Lian
a) You get a subsidy of 50% to 65% of the hospital bill
b) As the government is paying a large part of the bill, they will check that the bill is reasonable.
If the patient has to pay 100% of the bill (i.e no subsidy), there is a risk that the hospital may charge more, or give more treatment than necessary. You have to pay 100% of a larger bill.
I estimate that a bill from a private hospital could be 3 times of the subsidised bill, for the same treatment.
Some people said that the doctors treating patients in subsidised wards are under training and not experienced. I do not agree with this comment. It may be true that the doctors are under training, but they do the routine medical checks and are supervised by the experienced doctors.
When it comes to surgery or other major procedures, an experienced specialist will carry out the procedure. There is really no need for the patient to choose his own doctor.
However, if the patient is willing to pay a higher bill to be treated in a private hospitals or A class ward, and enjoy the privilege to choose their own doctor, it is all right. They can also buy insurance for the more expensive treatment, but the cost of the insurance can be three times.
Tan Kin Lian
Protecting consumers from scams
Mr. Tan,
Do you expect the government to protect people who are stupid enough to put their money into nothing more than somebody's word? For example, if someone got people to give him $1 million - saying that he would give them 20% return by passing the money on to his anonymous friend involved in some business, and one year on, - the anonymous friend had disappeared?
REPLY
There is nothing that the government can do, if they are not aware about this activity. However, if there is a report of such activity, it is the duty of the government to investigate if the people are crooks that goes about cheating other people with scams.
In the case of land banking, which is really a collective investment scheme, there is a need to regulate these activities, as it has been done in most countries. The regulation will ensure that the money is collected and used for its legitimate purpose and is not misappropriated.
There is also a need to ensure that the managers act honestly in the interest of investors (i.e. fiduciary duty) and pay the appropriate price for the land. They cannot "cheat" the investors by paying an inflated price for the land, especially if they buy from a connected party where there is a conflict of interest.
Where the investment scheme is advertised in the media to the general public, it is necessary for the product to be regulated and approved.
I do not expect the government to protect people from foolish investments or to compensate them for their loss. But the government should at least ensure that crooks are not free to cheat other people without any restraint.
Tan Kin Lian
Do you expect the government to protect people who are stupid enough to put their money into nothing more than somebody's word? For example, if someone got people to give him $1 million - saying that he would give them 20% return by passing the money on to his anonymous friend involved in some business, and one year on, - the anonymous friend had disappeared?
REPLY
There is nothing that the government can do, if they are not aware about this activity. However, if there is a report of such activity, it is the duty of the government to investigate if the people are crooks that goes about cheating other people with scams.
In the case of land banking, which is really a collective investment scheme, there is a need to regulate these activities, as it has been done in most countries. The regulation will ensure that the money is collected and used for its legitimate purpose and is not misappropriated.
There is also a need to ensure that the managers act honestly in the interest of investors (i.e. fiduciary duty) and pay the appropriate price for the land. They cannot "cheat" the investors by paying an inflated price for the land, especially if they buy from a connected party where there is a conflict of interest.
Where the investment scheme is advertised in the media to the general public, it is necessary for the product to be regulated and approved.
I do not expect the government to protect people from foolish investments or to compensate them for their loss. But the government should at least ensure that crooks are not free to cheat other people without any restraint.
Tan Kin Lian
Think cooperation and win-win
There is a dispute between Indonesia and Malaysia about the origin of the Pendek dance and batik cloth. Indonesians write to their newspapers to complain about the use of the dance and batik in the Malaysian tourism advertisement. Some Indonesians even search for Malaysians on the roads in Jakarta to abuse them.
This matter has now been taken at top levels of the two governments, in an attempt to solve the dispute over the claim of "ownership".
Malaysia now claim that the laksa, Hainanese chicken rice and chili crab is "owned" by them. This has implication on Singapore, as they are promoted as the cuisine of Singapore.
These disputes are a sign of the times and the weakening of the moral fibre of our society. People have become too selfish and think only of their own interest, and not the welfare of others.
There is no need for neighboring countries to compete for tourists. We can work together to promote several countries at the same time. Tourists going to one country is likely to stay a day or two in a neighboring country. We need to think of "win-win", "cooperation" instead of "competition".
We need a better way to handle disputes, rather than to have the negative aspects broadcast in the media or on the streets.
Tan Kin Lian
This matter has now been taken at top levels of the two governments, in an attempt to solve the dispute over the claim of "ownership".
Malaysia now claim that the laksa, Hainanese chicken rice and chili crab is "owned" by them. This has implication on Singapore, as they are promoted as the cuisine of Singapore.
These disputes are a sign of the times and the weakening of the moral fibre of our society. People have become too selfish and think only of their own interest, and not the welfare of others.
There is no need for neighboring countries to compete for tourists. We can work together to promote several countries at the same time. Tourists going to one country is likely to stay a day or two in a neighboring country. We need to think of "win-win", "cooperation" instead of "competition".
We need a better way to handle disputes, rather than to have the negative aspects broadcast in the media or on the streets.
Tan Kin Lian
YOG Quiz
Singapore will be hosting the 1st YOG (Youth Olympic Games) on 14 to 26 August 2010. Tan Kin Lian & Associates invite you to exercise your creativity by giving a name to any of the shape shown on the attached form. Participation is free. Enjoy the fun. Read the rules shown in the sheet.
It is easy to take part in this game. You only need to identify 1 shape with one country or sport or feature of the game. For example, which shape best represent
America
Canada
China
Japan
Australia
Singapore
Indonesia
or any other country
Which shape best represent
Swimming
Athletics
Cycling
Tennis
Long jump
High jump
Judo
or any other game
Which shape represents the Olympic Flame?
It is easy to take part in this game. You only need to identify 1 shape with one country or sport or feature of the game. For example, which shape best represent
America
Canada
China
Japan
Australia
Singapore
Indonesia
or any other country
Which shape best represent
Swimming
Athletics
Cycling
Tennis
Long jump
High jump
Judo
or any other game
Which shape represents the Olympic Flame?
FISCA volunteers - write complaints to Police.
FISCA wants to help members to write complaints to the Police, if they have been cheated or badly treated by another party, and some law has been infringed. The volunteers should preferably have knowledge of the law and experience in writing complaints to Police. If you wish to volunteer, send an e-mail to kinlian@gmail.com
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