What will happen to the public transportation system if the foreigners disappeared today?

WARNING, TWISTED MATHS AHEAD.

While discussing on the topic of the impact of foreigners on public transport with my sister, I did some crazy maths and arrived at an another of my dark side theory.

The complaint revolves around that the fact that 40% of the people in Singapore are foreigners, which contribute to the over crowding in public transport in Singapore.

What will happen if they suddenly disappear? The $$$ minded train operators had to do something to retain profits at the current levels. Once you are used to good profits, you will want to keep going, no matter what. How?

1. Decrease the frequency of trains by 40% to keep the trains filled as much as possible. The trains will still be packed, and we are all going to be late.
   
   
2. Increase the train fares by 40% to boost revenues back to previous levels. A 40% hike with additional hikes due to inflation is going to be a killer.

There is also another way to solve the problem.

TURN THEM INTO CITIZENS ASAP.

Just 2 generations ago, we are all foreigners too. It wasn't long ago when this was a quiet fishing village until the British came along. Read your history people, Singapore has always been full of immigrants and foreign workers.

Election day holiday ruined

I was hoping that Ang Mo Kio will be uncontested but my hopes were dashed when the The Reform Party sent in a team. PAP is doing a good job but it doesn't hurt to see what's the offering from an opposition party.

So I went to their webpage and poke around. I found their manifesto and my blood turned cold as I read on.

The Reform Party believes that Singapore belongs to its people and that government should serve the people and not the other way around. We want to build a first-class modern nation, in line with the rich and advanced democracies of the world. We believe that Freedom and Prosperity go hand in hand.

Without freedom of expression and a climate of ideas fostering innovation and creativity we will not only fall further behind the already rich nations of the US, Europe and Japan but also the new, and considerably freer Asian states such as South Korea, Taiwan and Hong Kong. Even our customary advantages in education and infrastructure are being eroded by India and China as well as many of our ASEAN neighbours.

The people who had written this must have no knowledge of global economic at all. If anyone in the party would, they could have updated their manifesto quickly.

So what's wrong? Here's why.

1. "We want to build a first-class modern nation, in line with the rich and advanced democracies of the world."
   
   Sorry for bursting your bubble but rich and advanced democracies are as rare as hens's teeth in the world. Due to the wealth effect, most of the "rich" countries are actually dead broke. Many people got no idea that we are now in a new currency war since 2009, the on-going European sovereign debt crisis and the upcoming collapse of dollar of the United States.
   
   We living in the age of Keynesian economics, which in simple turns allow governments to please their people by pushing off the debt incurred to the next government. It is like a credit card on the national scale. The western governments at this point had already busted their accounts and on the verge of not being able to even meet the minimum payment.
   
   No. I do not want to want to be anywhere "in line with the rich and advanced democracies of the world."
   
   
2. "...we will not only fall further behind the already rich nations of the US, Europe and Japan but also the new, and considerably freer Asian states such as South Korea, Taiwan and Hong Kong."
   
   Please replace the term "already rich nations" with "already bankrupt nations". Take a look at the World Debt Clock and tell me again, who is rich? Does wearing a nice suit and driving a new car makes you feel rich and wealthy? This is the wealth effect playing in our minds.
   
   I am not expert in freedom of expression so I will not be commenting on that.
   
   
3. "Even our customary advantages in education and infrastructure are being eroded by India and China as well as many of our ASEAN neighbours."
   
   Actually our real customary advantage is our way of governance, something that is not perfect but mostly done right. With the fall of the Western powers in full swing, and the ascendance of China, we still have a good advantage over our ASEAN neighbours.
   

Let's look at their policies pledges

1. Providing Cheaper and Better Lower-Income Housing by releasing more land for house-building and allowing the private sector a greater role.
   
   I must agree that our housing prices are soaring really fast recently. Providing cheaper housing (assuming public housing) has also a flip side of reducing the value of the existing housing, both private and public housing.
   
   Let's look at the scenario as the prices of housing actually falls. The private housing sector prices will first dip and then bounce right back as both foreign and local buyers will take the chance to enter the property market.
   
   Morever, as the currency war rages on, the flow of hot money will enter Singapore and take advantage of the situation, pulling the gap between private and public housing even further.
   
   The net effect will be that the prices of all existing public housing will fall a bit, making existing owners fuming and unable to upgrade to private housing as their existing housing will now fetch a lower price and the private housing will still be, if not more expensive than now.
   
   
2. Universal health insurance to be funded through current CPF contributions replacing current Medisave and Medishield schemes.
   
   This might be a good idea. While it might not replace the current schemes, complementing them may be a viable option.
   
   
3. Basic Old Age Pension payable to all provided they have worked and paid into CPF for a sufficient number of years.
   
   No no and no. This is a 1000% bad idea sold by politicians all over the world to get themselves elected, then passing the cost to future generations to come. Due to the effects of inflation and overly optimistic investment gains, the cost of the pension scheme will always overrun the ability of the sources paying for it. Almost every pension system in the world is on the verge of blowing up.
   
   
   Please no pension scheme of any sort, they will just bankrupt us all. There is no free lunch. You cannot get something out of nothing.
   
   
4. Reform of CPF to make contributions above those necessary to fund health and unemployment insurance and basic pension voluntary.
   
   Need to check whether this is sustainable. Is there any maths for this?
   
   
5. Universal child benefit scheme (as part of Guaranteed Minimum Income) to replace current tax breaks that heavily favour women on higher incomes.
   
   Raising children is indeed expensive in Singapore. This might help.
   
   
6. Guaranteed Minimum Income for those in work to replace current Workfare system and to be integrated with child benefit and tax system.
   
   This will certainly appeal to the lower income groups.
   
   
7. A Minimum Wage to encourage businesses to raise productivity.
   
   While it sound good, this policy got the potential to backfire really badly. How? As a business, the priority is to manage cash flow and reduce overheads. With a minimum wage law in place, what will a business do? For jobs that are already paying below the minimum wages, the permanent staff will be retrenched and the positions filled with temporary and contract workers!
   
   Any jobs paying slightly above the minimum wage will simply pay the minimum wage. I will trust businesses to be creative and employ more foreign workers to take up the jobs that the Singaporeans refuses to get paid for.
   
   Worse yet, the jobs simply disappear as they moved to neighbouring countries since we are now more expensive. Instead of helping the poor, this policy will kill them off.
   
   Check this article, "The miniumum wage" from Freedom Daily.
   
   
8. Reforms to Foreign Worker Policy to ensure that business gets the skilled labour it needs but that our own citizens come first.
   
   I am in the IT industry and the number of foreign workers is simply huge. Singaporeans are completely out numbered here. While interviewing people for open positions, the foreign skilled labour are usually cheaper, highly skilled and more experienced then Singaporeans. From a business perceptive, it's getting hard to be a patriot.
   
   
9. Reductions in or exemptions from GST for certain categories of goods like food that form a higher proportion of total expenditure for those on median incomes and below.
   
   The problem is not GST but inflation. It is inflation that bumps up food and energy prices not GST.
   
   Inflation and fiat money
   The key point that I must stress that the money you have in your bank and wallet isn't really money after all. No, it does not represent real money, nor it's a IOU of any sorts. It's call fiat money. It's pieces of paper that a country's government prints and declare the value of. The intrinsic value of fiat money is the value of the paper and ink used to print it. It is not tied to anything except pure faith that the next person recognise it. Any gain or loss of confidence in the fiat money in a country causes exchange rate changes.
   
   Since fiat money can be printed at will, there is practically no way to measure the value of the dollar bill that you are holding. It's like hot potatoes been passed from one to another. The problem is that eventually, the fiat money loses it's value over time because all government simply prints more and more. The act of printing money like this causes inflation. Because of the globalised ecomony, this actually became a weapon of mass economic destruction.
   
   Quantitative easing and inflation
   Since World War II, the United States had screwed up on their economic policy very badly, and by any definition, completely bankrupt. Since 2008, to buy more time, and leveraging on their position as the world's reserved currency, they had printed money so fast that their printing press could not print any faster, and they had to resort to adding zeros to bank balances.
   
   This caused the net effect of exporting inflation to the whole world. If you are demanding for an explanation of why things are getting more expensive, I will squarely blame the United States. As goods and services, commodities are all priced in US dollars, the appearance of newly created-out-of-thin-air-money caused the prices of everything to soar.
   
   While our government can control inflation to a certain extend, things are going to get worse.
   
   
10. Universal free and compulsory education from pre-school through to secondary level.
    
    Sounds good.
    
    
11. Expanded university enrolment and increased investment in improving quality of education for everyone.
    
    I didn't like it when I need to pay for my Australian degree with my own cash. But I blame myself for slacking too much in my first 20 years of my life too.
    
    
12. Increased assistance for older workers and women re-entering the labour market to retrain and acquire new educational qualifications.
    
    Similar to my comments at policy #7, this might turn against the people which the policy was meant to help.
    
    
13. Reduction in NS to 18 months initially with aim to reduce it to one year as soon as feasible.
    
    We all heard how NS was meant to secure our future blah blah blah. I must agree 2.5 years is too long, 2 years? How about 1.5 years?
    
    
14. Requirement for new citizens and PRs to do NS or to pay lump sum tax instead.
    
    Most new citizens are adults. Getting them to perform NS and to pay lump sum tax will only drive them away. This is economically a bad idea. I rather entice them to stay, integrate with us as citizens, and their children will serve NS.
    
    
15. Privatization of Temasek and GIC and distribution of equity to Singaporean citizens of more than five years standing.
    
    Temasek and GIC represent Singapore and the wealth are not for distribution. The role of the two entities are a lot more than companies making a quick buck.
    
    
16. Continuing Business and Foreign Investment Friendly Environment coupled with low tax rates.
    
    Yes! This is our rice bowl too. By the way, Singapore is also notorious for being a tax haven in the business world. Naughty but we need every edge we got.
    
    
17. Greater help and support for local SMEs to grow world-class companies.
    
    Great. Such things can always be improved on.
    
    
18. Abolish restrictions on freedom of expression to encourage creativity and innovation necessary for a 21st century knowledge-based economy.
    
    Catchy but doesn't make a lot of sense to me. It's like stringing several buzzwords together. Let's assume the freedom here refers to political freedom. Political freedom of expression had little to do with encouraging creativity and innovation. The 21st century isn't all about knowledge-based economy either. Is there a serious restriction on freedom of expression in the first place? In the Internet world, you can say all you want. We don't have a Great Firewall of Singapore.
    
    
19. Reduce waste and inefficiency in government starting with slashing ministerial salaries and replacing it with performance-linked earnings tied to indicators directly related to your welfare.
    
    Let's face it. Politics is always tied to money. Money always corrupts. This government is not corrupted and had done a good job. If this is the price of running things as they are, it is not expensive at all.
    
    Singaporeans growing up in Singapore had lived a fairytale all their lives. You actually have to dig hard before you can find any signs of corruption. Corruption is what bring down governments, societies and countries. It's a serious problem all over the world. Ask your foreign friends and you will understand how bad corruption can affect everyone. If their lawmakers and government can work like the Singapore government does at this price, they will gladly do so.
    
    Indicators tied to your welfare...we are not a welfare state. Politicians are not stupid. If they cannot get their money upfront, the squeeze it out of you elsewhere. From there on, it will be a slippery slope which will only end up in tears.
    

I have always regard the following as the golden rule in my life, borrowed ironically from a Citibank advertisement that I have seen when I was in Secondary school.

"Money is power"

And later I learn that the opposite is also very true.

When a party is in power, the must absolutely know how to handle money. This is very important. Extremely so.

When you are getting married, you will want to make sure that your partner is healthy, with common goal in life, has good track records and can make sound decisions, especially financially. There is no Mr or Mrs Perfect but there is always Mr or Mrs Right. Will you want to get married with a partner who promises a lot but has no track record of delivering and has no foreseeable way of doing so? Will you stake your future because you feel you want to take a leap of faith, taking a risk when the odds are against you?

How many stories did you hear about couples with horrible financial management? Your savings will be wiped out, your bright future gone and only doom awaits.

The economy is the lifeblood of the country. There is no way, I will vote for a party that has no idea how to handle the economy, selling populist ideas which sound very nice but will lead us to the path of doom. There is no way I will take risk like this, for pile of chips Singapore has is the only pile we will ever have. There is no second changes in this brutal world.

I am voting for my country based on the best interest of my country, not some short sighted populist policies that will only lead us to the dying economies of Europe, Japan and United States.

The Reform Party have to seriously get their priorities right. You need to sell policies, and implement them in a way that is sustainable and desirable. While their policies have good intents, the directions are mostly populist tactics and increase expenditure and reducing our competitiveness.

There is no prize for guessing who I am going to vote for. The party with the best proven track record and best plan for the future will get my vote.

Almost bought a few 1kg "coins"

I was on the verged of getting a few of those shiny silver "coins" for myself. Damn this guy in the picture got so many of ... my preciousssss.

After staring at pictures of silver coins on Monday night, I had decided to add on more silver @ USD$43.44 using the UOB silver savings after deciding against buying the physical coins and bars. The premiums for physical silver is 20% to 50% on top of the spot price! That's wicked! According to Gary (the guy who got me interested in silver), I had decided that it is worthwhile to risk buying more from UOB as the risk of default is low.

Not long after, silver hit a new high at USD $43.8, which was truly amazing. It took only 2 days to break the $43.5 resistance level. Give it a bit more time for gold to crack the USD $1500 barrier and it will drag silver to another new high.

For those waiting for a better price to buy, good luck with that.

Silverish shiny rocks got even more shinier

While looking for an image for shiny rocks, I ended up with a "Sexy Shiny Silver Metallic Short Catsuit Costume". Ahem, back to the topic, and forget the distraction above (stop staring), the shiny rocks that I had bought in proxy via the UOB silver savings account had made a unrealised gain of 25% in less than 6 weeks.

And here is the not so sexy version of the silver chart

While preaching the all goodness of the ever more shiny rock which kept getting shiny while doing basically nothing on its own, I came across a few common questions.

1. Q. Silver is very expensive now. Experts says that you should buy only on a substantial retracement / correction in price.
   A. Ever since the price left the $19 range in Sept 2010, the price had moved on to $43 in a blink of the eye. If this is a regular fiat currency, stock, bond, some other non-silver/gold commodities or whatsoever, it might actually have a meaningful retracement / correction. However go open up a silver chart and it will take a 126% retracement to go back to the last major support at $19. The last retracement 18 days, and then the next only 8 days, and who knows how long is the next one. Looking at the chart, you will almost never be able to get a better price from buying at a retracement.
   
   Frankly, I was also thinking of buying more on a retracement, but I am already wanted to /wrist myself for not believing in myself and bought more when it was $34.4.
   
   
2. Q. I don't believe you. I bet that you will lose $$$ in silver.
   A. If you are so sure, go and take a short position silver now. I will take the other end of the trade by taking a long position. At the unbelievable pace it is climbing, the year end $49 target is not a joke. If silver is a fiat currency, I would have already done a massive short on it, but nope, shorting silver on the long term will bankrupt you for sure.
   
   
3. Q. But people lost money in gold and silver!
   A. Did the same sources tell you those people were also doing leveraged speculative trades on gold and silver, and probably did not have the knowledge on how to manage a trade?
   
   
4. Q. $49 is impossible! $40 is already very high and more than double of $19. It's unsustainable and will collapse. Expert all says that.
   A. Those are the same experts who claimed the same when silver was at $10, $20, $30, $40. If these experts are so spot on, then why are they so damn broke and still working for a pay check to write nonsense?
   
   Here is my expert source whom I regretfully did not heed his advice 2 years ago on taking a long position on commodities. Jim Rogers!
   
   
5. Q. Ok, then how do I buy?
   A. Since there is almost no best time, and it is impossible to time the entry, you might as well do it blindly. I am talking about an unleveraged saving accounts dominated in silver, not much to risk here.
   
   
6. Q. What happens when it hits $49? Will it stop and roll over and take a dive? Should I sell then? Will it be the end? A cliff? Doomsday?
   A. In reality, $49 is the nominal high based on the previous high in 1980s after adjustment for inflation. Does it mean it will stop there? I got no idea frankly. I probably hold till it reached the moon's orbit.
   
   
7. Q. I still don't know what to do.
   A. Get out of anything denominated in US dollars at the very least. It is destined for eternal doom in the pits of hell. Frankly Euro also looks like the same case too.
   

Buying the poor man's gold

During the get-a-life-day (WoW maintenance day) on 1 March, I went out for a steamboat dinner at Ang Mo Kio central with Jia Lun. As usual, the topic was on how bad our job sucks and the doom and gloom in the world.

So it eventually boiled down this. With all the bad stuff happening in the world, is there anything we can do to take advantage of the situation? It wasn't long that the topic shifted to gold and silver, and particularly silver.

While trying make comparisons between FX, commodities, gold and silver, I found myself selling the idea of investing in silver more and more.

Why buy shiny rocks?
1) But shiny rocks are not sexy! Nobody buy rocks! They have limited industrial uses, and do nothing but shines! Gold and silver are the REAL money acknowledged by civilisations across the world for thousands of years. Fiat currencies are not, which lead us to...

2) While you can mine gold and silver, you can print paper currencies even faster. In the age of computers, you don't event need paper to print "money". Some broke central banks can go to a computer and add a couple of zeroes. Can you do that with gold and silver? Nope. Ever heard of quantitative easing? Money supply? Or the scale of the rampant money printing? US, UK, China, Europe and Japan...just to name a few are printing money out of the air faster than ever. Hyperinflation will come, it's a matter of time.

3) While the golden brother is obviously the most popular choice for investment, silver price movement is closely correlated with gold. This correlationship lead us to ...

4) Silver has more upside to it. The gold silver ratio will send it higher. Silver is a lagging brother behind gold, and the pull towards gold is not over yet.

5) And of course, I cannot afford to buy gold. At USD$1400+ per ounce, it's way beyond my means. The poor man's gold, still shiny without the golden halo works well at USD$34ish.

6) Nay, putting my $$$ in the bank is safer...until you realise that due to inflation and the useless saving rates, you are actually losing money by doing so. By the power of inflation, for every $100 you have in the bank, you automatically lose $2.80 annually (2011 projected 2.8% inflation rate for SG). Ouch? Or put it the other way, if you don't get at least a 2.8% pay raise this year, you are actually working for less. Everything you own, cash in bank, property etc loses value in the same way. What else can you do? Demand a pay raise! Bang tables, flip tables, smash something!



Finally the next day, I ran out of reasons not to buy silver. I went to UOB and opened a silver savings account with some of my savings which were rotting in my POSB account. So enjoy the chart below of my journey with the shiny rock.

Impact on markets due to recent events

Reuters has a nice interactive graphics on the effects of the recent events in Egypt, Libya and Japan.

Reuters lovely chart here

*Hint...buy silver now*

Sayonara Japan, maybe forever

Last year in November 2011, I had a vacation in Japan with my sisters. While trying very hard to stick to our itinerary and avoid getting lost in Tokyo city, I made a remark to my sister, Shiyun that the Tokyo that we were looking at was likely to be at its peak in modern history.

At that point of time, I was thinking along the lines of macro economics, like aging population, economic issues and their low reproduction rates (despite having an insane amount of porn in their media).But little did I knew, that the statement that I had made would had turned so true so soon. Things are now going downhill with such ferocity for Japan, that it is totally unreal.

On 11th March 2011, the forces of nature shook Japan with a massive 8.8-9.0 earthquake (depending on who you listens to), ravaged her with towering tsunamis, and then end the insult with an upcoming nuclear disaster involving 6 reactors.

The chains of events that had unfolded so far pretty much set what I had said to my sister in concrete. The Japan that she had visited will never be the same again. Probably by tomorrow, nuclear fallout would be spreading from the doomed power plant. That will send Japan into the Great Depression v2.0 faster than I thought, and with certainty.

By the way, you can kiss goodbye to the Japan holiday idea for a decade or so if the nuclear plant starts releasing nuclear fallout as prophesied.

Great depression V2.0

It has been years after I started to explore the financial markets, looking for a greener pasture instead if climbing the boring corporate ladder. Forex trading is still my main focus but I couldn't tame the beast just yet.

As each financial market is entwined with another, I eventually dug more into macro economics. While doing some research on macro economics and through the studying of the 2008 collapse of the sub-prime market which triggered a chain of crazy bubbles explosions, I learn that things are not well now. I can go on and on but let's summaries this quickly.

The worst is yet to come. The rampant debasement of the fiat currency which is the world reserve currency call the US dollar is on the verge of pushing the world into the next Great depression and maybe even WWIII.

It's a doom and gloom story here is my prediction for 2011 and beyond.
1) The official inflation rate 2011 estimate of 2-4% will be a joke. It will beyond 5%. Everything will increase in price.
2) Most currency will fall in value in relation to gold and silver.
3) There will be more wars, civil wars, border disputes, unrest, protest, and basically lots of angry people all over the world.
4) Watch your petrol price. It is going to soar.

So what to do?
1)Dump US dollar, anything that is denominated in USD$ is going to look really sad.
2)Buy gold and silver. Not the jewelery type but ETF, 99% bullion, 99% coins, UOB silver & gold saving accounts.

Prices of gold and silver are going through the roof. Grabs yours today.


3) Hang on to your government job if you have one.


Things are not so rosy this year.

Collateral damage

While doing my job as a all-in-one IT guy, there are so many times that I had came across issues which I could have make my own life easier by letting them go but didn't. It involves rubbing salt into old and fresh wounds, opening cans of worms and Pandora boxes, stepping on toes, jumping over people's heads, crossing hostile territories and getting death threats.

Ok I admit that I am making up the last one. Anyway, the benefits are there for the organisation to reap while I siphon some cash in return, making it a fair trade. But playing the devil with good intentions does require human sacrifices. I prefer to call them collateral damage, which could range from the lightest form as extra work for people, making people look bad to making people disappear.

Lately I claimed my latest victim, who was caught red handed in the cookie jar, and will end up exiting the organisation in shame. What did I gained? Nothing much except some extra work and the satisfaction of tasting blood. How about the organisation? Well this latest exploit bought them a few more weeks of time to drag their feet to get things done through the slow moving bureaucracy.

I am sure during the course my career in the organisation, more people will be crucified and sacrificed in the pursue of the betterment of the organisation .. and myself.

Next time, be wary of the IT guy next to you. You have been warned.

How fast can a reward turned sour?

Somewhere around 15 minutes.

During last month department meeting, I got a surprise when my group head Mr See announced that I had won a newly created reward. This reward was meant for recognizing one person per department who had slaved the most to contribute to the department. I guess either my hard work and commitment to work had got me something to show for it. But instead, it is my lack of social life had came back to haunt me.

I opened up the envelop and read the content of the letter inside. The reward was a stay in one of the YTL luxury resorts in the region ... for 2. That's about when all the euphoria sunk to the deepest hole in the oceans.

Ok, let's review the conditions.

1. To be used within a year.
   Sounds fair.
2. For a stay for about 2 days/1 night.
   Hmm no transport? Some of the resorts are really far out. No problem though.
   
3. Employee must be present with employee pass.
   Cannot sell or give away to anyone. I must be present to check in. Ahh no trading or Ebay. Oh wait, must be employee pass! That means I cannot quit to claim it.
   
4. For 2 person
   Ok this is the worst part. I can't give it to my parents because of condition 3. If I bring my sisters, I need to pay for an additional headcount. Not all resorts have the capacity to allow a 3rd person in the room provided.
   

And with the above conditions, the reward quickly turned sour. I had a few options.

1. Let it lapse.
   Hope everyone forget it.
   
2. Forcibly give it away.
   Tell my department head that I don't want the reward.
3. Go alone.
   I rather stay at home then.
4. Go with sisters.
   I got to cough up extra $$$ to rope in my youngest sister because she will go bankrupt after the upcoming Tokyo trip in November.
5. Go with a buddy.
   Gayyyyy.
   
6. Get a girlfriend and go.
   ... and risk being labeled as a wolf.
7. Go with the other winners.
   Most of them are attached, married, wrong age group or are guys.
   

Not long after, HR decided to send out a email broadcast to everyone to announce the winners of the rewards. So, whenever someone came around to say congratulate me, the (heart) pain revisited me. Ouchie.

Anyway, got to make a choice, and I made it Tembok Bali, the spa resort.