Read this report.
My comment
Many investors have approached me for assistance on similar investments which were not repaid after the maturity date.
Monday, May 31, 2010
20 year impasse
Someone attacked me for posting my views about the 20 year impasse in reaching agreement on the bilaterial issues and challenged me to state what I would have done if I were "PM, SM or MM". It is difficult to be engaged in a discussion with a vile person whose primary purpose is to attack another person under anonymity.
I like to give my views in this hypothetical situation. It would not be possible to judge if my approach would achieve any useful results. I would approach this issue on the personal values that I follow:
- honesty
- fairness
- positive
- courage
- public service
If we are honest and fair, it would be easy to win the trust of the other party. Both parties can look at the positive aspects and focus on what each side could gain from the cooperation.
I sense that one side felt that the Points of Agreement was not fair to them (for whatever reasons) and although it was agreed, they would find other ways to get out of the deal. The other side insisted that "a deal is a deal" and should be honored. This explains the impasse that lasted for 20 years. Both sides need the courage to recognise that the earlier deal would not work, and that a new approach had to be taken (without waiting for 20 years).
As this is a hypothethical case, no one know whether it would have worked. I invite other people, wishing to give their views, to give their name and to refrain from passing judgement in this hypothetical case, or to make personal attacks.
Tan Kin Lian
I like to give my views in this hypothetical situation. It would not be possible to judge if my approach would achieve any useful results. I would approach this issue on the personal values that I follow:
- honesty
- fairness
- positive
- courage
- public service
If we are honest and fair, it would be easy to win the trust of the other party. Both parties can look at the positive aspects and focus on what each side could gain from the cooperation.
I sense that one side felt that the Points of Agreement was not fair to them (for whatever reasons) and although it was agreed, they would find other ways to get out of the deal. The other side insisted that "a deal is a deal" and should be honored. This explains the impasse that lasted for 20 years. Both sides need the courage to recognise that the earlier deal would not work, and that a new approach had to be taken (without waiting for 20 years).
As this is a hypothethical case, no one know whether it would have worked. I invite other people, wishing to give their views, to give their name and to refrain from passing judgement in this hypothetical case, or to make personal attacks.
Tan Kin Lian
Dr. Goh and frugality
Hi Mr Tan,
The said insurance company, published in full page in 4 languages in the national newspapers (on 29 May), including TODAY paper today (31 May). It pays tribute to the great founding father, the late Dr Goh who inspired the setting up of the first insurance co-operative - 40 years ago.
Dr Goh was the Chairman for the first ten years. He leads a frugal life and does not waste money and resources. I am sure that if Dr Goh is still alive, he will not approve such wasteful and unnecessary spending of policyholders' money. There are other frugal and economical ways of paying tribute to the late Dr Goh
It said that it celebrates it 40th birthday as a co-operative.
How sad that all the efforts started by the late Dr Goh in pioneering the co-operative movement has been eroded by the new management team. It is no longer a simple co-operative, but a 'commercialised co-operative' with many benefits taken away
We need leaders like you to highlight through the forum, the wasteful spending of policyholders money in such unnecessary publication of the tribute to the late Dr Goh.
CK
My comment
Dr. Goh Keng Swee's contribution to the welfare of 2 million families in Singapore who has benefitted from NTUC Income is immense and immeasurable. The money spent on recognising this contribution is small and, although it comes from the policyholder's funds, is worth spending. Many young people may not be aware about the part that Dr. Goh has made in this important aspect of the lives of Singaporeans. It is just as important as the building of the economy to create jobs for Singaporeans, which was well covered in the media.
I hope that NTUC Income will recognise the value of frugality that Dr. Goh has lived his life, and money should be spent wisely so that the policyholders can continue to enjoy a good return on their savings.
Tan Kin Lian
The said insurance company, published in full page in 4 languages in the national newspapers (on 29 May), including TODAY paper today (31 May). It pays tribute to the great founding father, the late Dr Goh who inspired the setting up of the first insurance co-operative - 40 years ago.
Dr Goh was the Chairman for the first ten years. He leads a frugal life and does not waste money and resources. I am sure that if Dr Goh is still alive, he will not approve such wasteful and unnecessary spending of policyholders' money. There are other frugal and economical ways of paying tribute to the late Dr Goh
It said that it celebrates it 40th birthday as a co-operative.
How sad that all the efforts started by the late Dr Goh in pioneering the co-operative movement has been eroded by the new management team. It is no longer a simple co-operative, but a 'commercialised co-operative' with many benefits taken away
We need leaders like you to highlight through the forum, the wasteful spending of policyholders money in such unnecessary publication of the tribute to the late Dr Goh.
CK
My comment
Dr. Goh Keng Swee's contribution to the welfare of 2 million families in Singapore who has benefitted from NTUC Income is immense and immeasurable. The money spent on recognising this contribution is small and, although it comes from the policyholder's funds, is worth spending. Many young people may not be aware about the part that Dr. Goh has made in this important aspect of the lives of Singaporeans. It is just as important as the building of the economy to create jobs for Singaporeans, which was well covered in the media.
I hope that NTUC Income will recognise the value of frugality that Dr. Goh has lived his life, and money should be spent wisely so that the policyholders can continue to enjoy a good return on their savings.
Tan Kin Lian
Sunday, May 30, 2010
Relevance of Tommy Wong's book
Tommy Wong's book, Wisdom to Live your Life, is relevant to the people who have lost money on the mini-bonds and other credit-linked notes.
Tommy talked about the greed in the materialistic world where the following people make a lot of money (and in the process made other people poorer):
a) politicians
b) top CEOs
c) bankers
He also talked about how to find happiness in the spiritual world by living on certain principles. This came give some comfort to those who have been made poorer by the greedy financial institutions.
His book has relevance to the situation in Singapore. It is easy to read. You can buy his book online here.
Tan Kin Lian
Tommy talked about the greed in the materialistic world where the following people make a lot of money (and in the process made other people poorer):
a) politicians
b) top CEOs
c) bankers
He also talked about how to find happiness in the spiritual world by living on certain principles. This came give some comfort to those who have been made poorer by the greedy financial institutions.
His book has relevance to the situation in Singapore. It is easy to read. You can buy his book online here.
Tan Kin Lian
Low cost investment funds
Dear Mr Tan,
I've read your blog regularly and you're an advocate of low cost index fund as the primary tool for investments. While the idea it's great in principle, I find the lack of index fund products in Singapore to be somewhat inconvenient. Based on my analysis, we only have the following products locally, either through unit trust or traded at SGX:
Singapore Stock
There is only StreetTracks STI ETF and DBS STI ETF. Both track the same index. In my opinion the STI Index is not that well diversified, it only has 30 companies (compare it to S&P 500) and it comprises only of large cap stocks. There is no index fund or ETF that tracks a Singapore small cap index, or even an index that has more companies making up the index (e.g. a Singapore total market index that has small + large cap companies).
Singapore Bond
There is only the ABF Singapore Bond ETF, which is to my knowledge the only passively-managed bond fund in this country. However, the ETF suffers from problems like liquidity, large bid-ask spread and trading prices not tracking its NAV properly. It behaves more like a stock than a bond index fund at times. Considering that it invests only in SGD-denominated government bonds, that shouldn't be the case. As for bond unit trust, most do not invest in local bonds and is subjected to currency risk. Bond unit trust also have expense ratios like ~1% which makes extremely unattractive. The last way is to invest in SGS bonds direct, but regularly saving into SGS bonds is difficult as they have fixed issuance dates. To complicate the matter, SGS bonds cannot be bought online (unless you consider FSM secondary SGS bond market).
International Stock
Many of the Lyxor series of ETF which do cover international stocks are usually single country fund and are not a good form of diversification. There are some regional/global ETFs, but the whole range of Lyxor ETFs suffer from liquidity problems too. There is only 3 unit trust that are passively managed, and those are the Lion Capital Infinity series that are feeder funds into Vanguard index funds. However, Lion Capital slaps a 1% management fee just for feeding money into Vanguard index funds... real easy money for Lion Capital for just doing almost zero work!
I was hoping if you could comment on this in your blog one day. It certainly would help if we had more good index fund based products in Singapore.
Garrett
My comment
Read my book, Practical Guide on Financial Planning available at www.easysearch.sg/ishop
Some people commented about the lack of liquidity of the STI ETF. This should not be of concern to the long term investor. The ETF manager will create more units to meet demand. The ETF is not suitable for short term trading, but is suitable for long term investing. Just place your order at the price indicated by the index and wait for someone to sell the units to you. Be patient.
I've read your blog regularly and you're an advocate of low cost index fund as the primary tool for investments. While the idea it's great in principle, I find the lack of index fund products in Singapore to be somewhat inconvenient. Based on my analysis, we only have the following products locally, either through unit trust or traded at SGX:
Singapore Stock
There is only StreetTracks STI ETF and DBS STI ETF. Both track the same index. In my opinion the STI Index is not that well diversified, it only has 30 companies (compare it to S&P 500) and it comprises only of large cap stocks. There is no index fund or ETF that tracks a Singapore small cap index, or even an index that has more companies making up the index (e.g. a Singapore total market index that has small + large cap companies).
Singapore Bond
There is only the ABF Singapore Bond ETF, which is to my knowledge the only passively-managed bond fund in this country. However, the ETF suffers from problems like liquidity, large bid-ask spread and trading prices not tracking its NAV properly. It behaves more like a stock than a bond index fund at times. Considering that it invests only in SGD-denominated government bonds, that shouldn't be the case. As for bond unit trust, most do not invest in local bonds and is subjected to currency risk. Bond unit trust also have expense ratios like ~1% which makes extremely unattractive. The last way is to invest in SGS bonds direct, but regularly saving into SGS bonds is difficult as they have fixed issuance dates. To complicate the matter, SGS bonds cannot be bought online (unless you consider FSM secondary SGS bond market).
International Stock
Many of the Lyxor series of ETF which do cover international stocks are usually single country fund and are not a good form of diversification. There are some regional/global ETFs, but the whole range of Lyxor ETFs suffer from liquidity problems too. There is only 3 unit trust that are passively managed, and those are the Lion Capital Infinity series that are feeder funds into Vanguard index funds. However, Lion Capital slaps a 1% management fee just for feeding money into Vanguard index funds... real easy money for Lion Capital for just doing almost zero work!
I was hoping if you could comment on this in your blog one day. It certainly would help if we had more good index fund based products in Singapore.
Garrett
My comment
Read my book, Practical Guide on Financial Planning available at www.easysearch.sg/ishop
Some people commented about the lack of liquidity of the STI ETF. This should not be of concern to the long term investor. The ETF manager will create more units to meet demand. The ETF is not suitable for short term trading, but is suitable for long term investing. Just place your order at the price indicated by the index and wait for someone to sell the units to you. Be patient.
Survey on Orphaned Policies
Dear Mr Tan,
Thank you for referring your readers to my "Orphaned Insurance Policy" poll. The 2-minute-only poll is still open and they can help out if they haven't. The updated results, charts, and comments are available at:
http://cliftonphua.blogspot.com/2010/05/updated-results-from-orphaned-insurance.html
Below is my take on results from the first 40 respondents.
(1) Respondents are mostly over 35 years old with 3-8 policies.
(2) More than 4 out of 5 Singaporeans have at least 1-2 orphaned policies.
(3) Most orphaned policies came from AIA, Prudential, and NTUC Income - the most established insurance companies in Singapore.
(4) Original financial advisor usually left without giving reason, joined another insurance company, changed career or retired - fair enough, this happens in any company and industry.
(5) Out of those Singaporeans with orphaned policies, only about 1 out of 4 of their new financial advisors have contacted them. 1 out of 8 have assisted them before and to very little satisfaction. In my opinion, this is an unacceptable service level. Policy holders don't seem to care… only until something rare but dramatic happens…
(6) Usefulness of financial advisors is questionable
"It's good to know about what you bought. I've no problem living without an adviser as I have find out more than enough information / procedures should I need any form of service or claims. It makes no difference with or without an insurance adviser."
"This is to be expected. No stepmother will treat you better than your real mother. It is wishful thinking that the orphaned policies will get better treatment from the new agent since the bulk of the commission is already given to the original agent. It is time that a separate channel be made available for people to buy policies without going through agents since they do not add value anyway nowadays."
(7) Commission-only incentives for financial advisors are evil
"It is a shield (medical) plan, the company could have assigned a new advisor but didn't. probably because the premium is small and the new advisor will not get renewal commission."
"The new financial advisor is only interested to generate new sales for herself."
"Commission-based selling is the culprit!"
Clifton Phua
Thank you for referring your readers to my "Orphaned Insurance Policy" poll. The 2-minute-only poll is still open and they can help out if they haven't. The updated results, charts, and comments are available at:
http://cliftonphua.blogspot.com/2010/05/updated-results-from-orphaned-insurance.html
Below is my take on results from the first 40 respondents.
(1) Respondents are mostly over 35 years old with 3-8 policies.
(2) More than 4 out of 5 Singaporeans have at least 1-2 orphaned policies.
(3) Most orphaned policies came from AIA, Prudential, and NTUC Income - the most established insurance companies in Singapore.
(4) Original financial advisor usually left without giving reason, joined another insurance company, changed career or retired - fair enough, this happens in any company and industry.
(5) Out of those Singaporeans with orphaned policies, only about 1 out of 4 of their new financial advisors have contacted them. 1 out of 8 have assisted them before and to very little satisfaction. In my opinion, this is an unacceptable service level. Policy holders don't seem to care… only until something rare but dramatic happens…
(6) Usefulness of financial advisors is questionable
"It's good to know about what you bought. I've no problem living without an adviser as I have find out more than enough information / procedures should I need any form of service or claims. It makes no difference with or without an insurance adviser."
"This is to be expected. No stepmother will treat you better than your real mother. It is wishful thinking that the orphaned policies will get better treatment from the new agent since the bulk of the commission is already given to the original agent. It is time that a separate channel be made available for people to buy policies without going through agents since they do not add value anyway nowadays."
(7) Commission-only incentives for financial advisors are evil
"It is a shield (medical) plan, the company could have assigned a new advisor but didn't. probably because the premium is small and the new advisor will not get renewal commission."
"The new financial advisor is only interested to generate new sales for herself."
"Commission-based selling is the culprit!"
Clifton Phua
Ranking of cities by Quality of Life
Here is another ranking by Mercer
http://www.mercer.com/qualityoflivingpr
My comments (revised):
Each survey uses its own criteria, as explained in the report.
The top 5 cities are:
1 Vienna
2. Zurich
3. Geneva
4. Vancouver
4. Auckland
Singapore ranked 28 but is highest in Asia.
http://www.mercer.com/qualityoflivingpr
My comments (revised):
Each survey uses its own criteria, as explained in the report.
The top 5 cities are:
1 Vienna
2. Zurich
3. Geneva
4. Vancouver
4. Auckland
Singapore ranked 28 but is highest in Asia.
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