Speeches from the White House

I am impressed with the way that the Obama Administration is communicating with the people, not just President Obama but also Vice President Biden. That is true, democratic leadership. Watch the videos here.

Working together

President Obama reaches out to the Republican members of Congress and have a dialogue with them, to try and find ways to work together. This is a good example for all leaders - to find solution, they need to have dialogue with the people and their elected representatives. Watch this video.

Buying consumer goods on installment payment

A furniture store advertised several products, e.g. television, notebooks, computers, furniture, cameras for sale on cash or weekly installments over 48 years.

Here is an example:
Notehook: cash price $1,299
Weekly installments over 4 years (i.e. 208 payments) of $11.87

Here is my calculation of the interest charges:
Total  payment over 4 years: $2,469
Cash price: $1,299
Interest charge: $1,170
Annualized interest rate: 36%

Using installment payments, the customer has to pay almost twice of the cash price. The interest charge is almost as much as the cash price. The same formula is applied consistently on all of the products offered on weekly installments

By saving in advance and paying cash, the customer can save a lot of interest charges. It is important to save and pay cash, rather than buy consumer products on installment payments.

Tan Kin Lian

Practice your skill in stock picking

Many students attend courses on financial analysis, but they do not have the chance to put the knowledge into practice.

Pro-investor has been developed to give this practice. How do you pick the right stocks based on trends in the country, industry and market segment? Do the earnings per share (EPS) or price earning ratio (PER) give you an indication about the growth and overpriced stocks? What about the price trends in recent years?

Go to Pro-Investor and put your knowledge into practice. Register an account. Read the Guide. And Play the game. Practice many times, until your reach Level 9 and register to be a Champion.

High housing price in Singapore

Dear Mr. Tan,


Singapore's current leaders, instead of owning up to a bad performance, attempts to do their job using the cheapest instrument - words.


They insist repeatedly that housing is affordable on one hand, against everyone's common sense,
and yet they also claim that the rapid climb in Singapore's housing prices is a positive and purposeful result of PAP's good work in growing our economy and that is where your wealth and your kids' future wealth will come from.


And to top it off, Lee Kuan Yew put forth the assumption that should Mah Bow Tan be ousted from Tampines GRC, everyone should sell their flats because it will become worthless?


http://whomovedmysingaporecheese.blogspot.com/2010/01/let-truth-be-told.html

Abolish the Financial Advisors Act?

Comment posted in TKL Blog


I have a radical suggestion and that would be to scrap the FAA. The FAA is one hell of a bible that I can bet that not a single financial adviser rep has read and understood it from cover to cover. What it does is raise entry barriers to new FAs. I'm not exactly well-versed with the FAA but I believe one such instance is that FAs must have a capital of a certain minimum sum. This prevents FAs with an "ethical" culture from thriving as they won't have that kind of capital in the first place. It is a known fact the "unethical" reps "earn" more than "ethical" reps for their principal.

Another problem in the FAA is under training and competency. Anyone and everyone should be allowed to hold a license. This way, where's the "information assymetry" now? These "part time" brokers can act as the "direct channel" that has been dreamed of for such a long time. They have full time jobs and just act as "form fillers" who knows the drill and won't stuff any products down your throat since they don't live on that anyway. The FAA restricts such "neutral" brokers as the FA has to spend resources to train them to satisfy CPD hours. Without the FAA breathing down FAs to train their brokers, FAs will be more than happy to have "inactive" brokers who do nothing but help friends and relatives fill forms. They know what's going on behind the scene, the commission, the exclusions etc and won't lose too much dough sharing with his "prospect" for the lack of a better word. Honestly, the training for CPD hours is nonsense. How does holding a party at Expo or Suntec count as 5 hours of skills or knowledge?

The professional consultants who do real financial planning can still carry on with their usual rounds, but as many have pointed out, "the probability of finding an ethical and upright financial sales staff is 0.01%."

People always draw analogies between financial "consultants" and doctors. There is a stark difference here. Financial planning is voluntary, and can be managed by yourself provided you read TKL's good book and do research. In fact, you would make the most objective decisions this way as there is 0 conflict of interest. Medicine however requires years of study and training and medical services demand a high price due to this exclusivity to only the brightest and most determined of the population. If fiancial services were to become such (given even higher entry barriers), people will avoid them altogether due to the high charges and simply read TKL's book instead.


wjsim

Wages and purchasing power

According to this article, Singapore has the lowest wages and domestic purchasing power among the Asian Tigers.