Sunday, December 20, 2009
Shape Quiz at $2
The Shape Quiz is now available for $2. It comprises of 100 shapes in a printed sheet and comes with 4 plastic pieces. Available from www.easysearch.sg (Internet shop). It is a good gift for children for the new year. You can order it to be sent to you by post.
Climbing stairs as an exercise
When I was in Sichuan the tour guide made this observation. When he was in Singapore, he was surprised that people queue up for the lift, even though they only need to travel a few floors. In Chengdu, most buildings are up to 5 stories only, and people are used to walking the stairs.
I agree with this observation. I have now decided to walk up the six floors to my office in Ang Mo Kio, instead of taking the lift. This will give me the chance to exercise a few times a day.
I agree with this observation. I have now decided to walk up the six floors to my office in Ang Mo Kio, instead of taking the lift. This will give me the chance to exercise a few times a day.
Time to scrap the White Pages
The telephone directory is now unnecessary. It is time to scrap this directory and save the trees. Read this report.
Coping with unemployment
Many developed countries have unemployment benefits. Even America, which believes in individual responsibilty and the free market, have unemployment benefits. The leaders in these countries know that the unemployment benefits can be abused, but they still provide these benefits as, in their judgement, the good outweighs the abuses.
In the free, competitive market, people compete for jobs. Some win and other lose. The losers gets unemployed. They have families to feed. In a weak economy, it is not easy to find an alternative job that can pay an adequate wage for their needs. Should they have to borrow and pay a high interest charge? Do the family have to grow hungry? Some have to resort to crime to get some money. Is this a good outcome?
What about people who are lazy and will enjoy the unemployment benefit, without working? These countries have found many ways to overcome this problem. Some countries, fix a limit on the duration of the unemployment benefits. In America, this is usually 12 months, although it has been extended due to the extremely weak economy. In other countries, the unemployed worker is required to attend job training and interviews, and to accept reasonable offers. They can only get the unemployment benefits, when jobs are not available.
These measures are not perfect, but they work reasonably well. If this was not the case, they would have been stopped.
What about countries, such as Singapore, that do not provide unemployment benefits? It is important to have personal savings that can be drawn down to meet emergencies, such as unemployment. Most young people are able to get jobs. They should set aside personal savings of 15% to 30% when they are young. These savings should be invested in financial products that can be withdrawn easily, without paying a high penalty. They include stocks and bonds traded on an Exchange.
Tan Kin Lian
In the free, competitive market, people compete for jobs. Some win and other lose. The losers gets unemployed. They have families to feed. In a weak economy, it is not easy to find an alternative job that can pay an adequate wage for their needs. Should they have to borrow and pay a high interest charge? Do the family have to grow hungry? Some have to resort to crime to get some money. Is this a good outcome?
What about people who are lazy and will enjoy the unemployment benefit, without working? These countries have found many ways to overcome this problem. Some countries, fix a limit on the duration of the unemployment benefits. In America, this is usually 12 months, although it has been extended due to the extremely weak economy. In other countries, the unemployed worker is required to attend job training and interviews, and to accept reasonable offers. They can only get the unemployment benefits, when jobs are not available.
These measures are not perfect, but they work reasonably well. If this was not the case, they would have been stopped.
What about countries, such as Singapore, that do not provide unemployment benefits? It is important to have personal savings that can be drawn down to meet emergencies, such as unemployment. Most young people are able to get jobs. They should set aside personal savings of 15% to 30% when they are young. These savings should be invested in financial products that can be withdrawn easily, without paying a high penalty. They include stocks and bonds traded on an Exchange.
Tan Kin Lian
Investing in properties
Many people made huge gains by investing in properties in the past. This was achieved at a time when property prices were relatively low, compared to today. At today's prices, it will be difficult to expect further appreciation along the scale as was achieved in the past.
The trend of interest rate is also going against property investments. During the past twenty years, there was a decline in interest rate globally. This decline contributed to appreciation in property prices. For example, if interest rate dropped from 6% to 3%, the prices of properties will double.
Interest rate is very low now. At the short end, it is near zero. For longer terms, it is around 3%. In the future, it is likely to increase. This will result in a drop in property prices. It could drop by 50%, if the long term interest rate were to double from today's level.
Interest rate is expected to remain low, due to deflation, but may increase from the highly depressed level of today, so you can expect some correction in property prices in the year's ahead.
To learn about what can happen when the property market corrects, we have to look at what has happened in America and Europe. They have allowed the property prices to increase too much due to low interest rate, subprime mortgages and financial instruments. When these markets correct, the damage to the economy has been severe.
In all, it is a bad time to invest in properties as a long term investment. People still have to buy a property to live in, although they should consider the option to rent a property. Apart from interest rate, property prices will also depend on supply and demand and the economic situation. But interest rate does play a big part.
Be careful about investing in properties (other than for own occupation).
Tan Kin Lian
The trend of interest rate is also going against property investments. During the past twenty years, there was a decline in interest rate globally. This decline contributed to appreciation in property prices. For example, if interest rate dropped from 6% to 3%, the prices of properties will double.
Interest rate is very low now. At the short end, it is near zero. For longer terms, it is around 3%. In the future, it is likely to increase. This will result in a drop in property prices. It could drop by 50%, if the long term interest rate were to double from today's level.
Interest rate is expected to remain low, due to deflation, but may increase from the highly depressed level of today, so you can expect some correction in property prices in the year's ahead.
To learn about what can happen when the property market corrects, we have to look at what has happened in America and Europe. They have allowed the property prices to increase too much due to low interest rate, subprime mortgages and financial instruments. When these markets correct, the damage to the economy has been severe.
In all, it is a bad time to invest in properties as a long term investment. People still have to buy a property to live in, although they should consider the option to rent a property. Apart from interest rate, property prices will also depend on supply and demand and the economic situation. But interest rate does play a big part.
Be careful about investing in properties (other than for own occupation).
Tan Kin Lian
Understanding fund brochures
The language used in fund brochures look impressive. But, what do the words really mean? Here is one person's explanation. Be careful before you invest. Understand what you are investing in.
Why pay Singapore TV licence?
Dear Mr Tan
This subject has been brought up many times. Occasionally, the authorities would give replies, including at least once in Parliament, but they failed to convince the public.
Personally, I do not object to the Government collecting money from me because they need to pay the service providers too and, in this case, for "funding public service programs on TV and radio". However, I have always had an uncomfortable feeling as to how they actually spent $8 million a month.
Just my own thoughts.
Bonus of bankers
America should set caps on the bonus of bankers, just like UK and France. Read this report.
Pearl Shaol Falls in Jiuzhaigou, China
Here is a video of this beautiful waterfall in Jiuzhaigou, China.
Take care of customers
Here is the ranking of various types of businesses based on how well they take care about their customers.
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