2/23/2009

The end of the Shopping Spree

It was great fun going on a shopping spree with a container of cash. Better still when it is other people's money. Take all the credits and big bonuses if it turns out right, and if not, well, so be it. Buying the world is not as simple as it turns out to be. When everyone plays by the rule, proper trading practices, it should not go too far wrong. Unfortunately the world is infested with thieves and conmen of all disguises. Now we have came home with a basket of rotten eggs. And the rotten eggs will not become fresh any more. Caveat Emptor! Would it be easier and safer to invest at home? Here every element is under our control and supervision. The entities are known and can't go too far wrong. But we have neglected our own local companies and the stock market. They have been ruined. Big funds were allowed a free hand and free play to destroy the values of our stocks and emptying the pockets of our small investors by sheer muscles. It is time that we look inward, use our own funds and take on these big funds, save our market, the stock value of our companies, and the small investors. With $1b and the connections, it is so easy, yes, so easy to lick the big funds and make them pay for their waywardness and destruction of our wealth, the wealth of corporations and individuals. Overseas shopping spree is over. Time to help ourselves and save ourselves with our own money. No more dumping in unknown land, unknown companies and management, and ended with baskets of rotten eggs. Play in a pool that we know well. We have comparative advantages.

12 comments:

Jaunty Jabber said...

Shopping spree is stemmed from the uncontrolled human greed.

We are now no longer a state of growth but a state of excess. In this society of excrescencem. The most obvious growth that we can see is "growing" out of control, recklessly. The impact of greed due to a lag in self-control brings multiplying impacts and the causes disintegrate.

The above refers not only to individuals, but also to organizations, institutions, boards, etc.

Living well is not about how much money you have, it is about how much money you can live without.

You can have greed, as long as you access it, calculate it and ensure that you do not hurt yourself or others. This sound difficult but asking yourself these questions does help to at least down-size your greed and reduce your risk, by a bit or, can be a lot.

redbean said...

yes, it is greed. there is also a high dosage of delusion.

the thing is that they could make so much money in the local market with just $1b capital to play with. and the probability of losing it is so low.

they need to come into the local stock market and fight like a street fighter, with tanks and heavy artillery. it is almost a sure win proposition.

Anonymous said...

Redbean, what makes you so sure the money is even there to begin with? That is a very big assumption to make. Until we, the people are presented with an independently audited accounts of the reserves, we have to work on the assumption that all that money has gone up in smoke.

redbean said...

ok, ok, let's be more objective and professional about this. we can't assume that it is there and neither can we assume it is not there.

proper accounting? i think citibank, merrill lynch, ubs, etc all have proper accounting.

the best thing to do is to put honourable and honest men in charge, those with spotlessly clean credentials. then we just trust them to do a good job, and be honest with our money.

can?

Dog said...

If like China, we have our $1000B reserves in USA govt bonds, I think we should feel secure our country is rich.
If instead the money is in pvt companies' stocks & shares then I think our reserves are not even worth the chips of Genting Casino.

Anonymous said...

I don't believe the shopping spree is over, not when people can just pass the basket of rotten eggs to another human bean when things turn sour. There must be some responsibility in all this.

Proper accounting? I heard there are auditing firms advising clients how to evade tax. I mean, using loopholes.

The mention of the words 'honourable and honest' brings up the memory of Teh Cheang Wan. He was known as the 'oriental gentleman'. He was obviously not gentle in taking huge bribes.

Lost Citizen

Matilah_Singapura said...

I disagree. They didn't spend enough and should have bought more. They should have BORROWED like mad to buy more and more. Just like consumers with credit cards. Run out of money? No problem. Just extend the credit line.

Imagine, if the SG.GOV's international acquisitions were financed by taking on excessive debt, the reserves would be in MINUS.

Then sit back and watch the fun!

redbean said...

$100b = $100,000,000,000.

anyone know how much is that?

sigh.

Anonymous said...

can still save the local industry?

they already destroyed all the local small businesses through glc, taking back land for sale,relentless increase in rent by hdb,reits etc etc.

look at the many older estates that became ghosttowns because of their relentless rent hikes (queenstown,beach road etc.)

redbean said...

high prices and high rentals are good. they will help to preserve the values of our properties, esp HDB flats.

better be grateful.

i think lim hwee hua said something like setting up a fund to buy local companies. they better hurry or there would be many left.

Anonymous said...

How long can they keep on preserving the high rentals and HDB prices? The only way is to hope that they can ride out this crisis and hope for another golden period. Fat hope.

After this bloodletting, there is no way we can return to conditions resembling the last decade. If we can sail along smoothly, that will be something, but hoping for high growth to sustain high property prices and rentals is a pipedream.

There is always a period some countries will enjoy high growth, after that it will stagnate or decline. Why should they even think we are going to be different. Just by shouting that our fundamentals are strong? In that case, why are they saying that they are not the masters of the Singapore's economy?

Just look at Japan. Have they really recovered from the property bust more than a decade ago? The Japanese are the most innovative and resilient people and even they cannot find a way out of the woods.

Lost Citizen

redbean said...

yep, a flat is still a flat. if got buyers, it may fetch a million. if no buyer, it may fetch a few thousands.

to many singaporeans it is just a roof over their head. don't drive their heads through the roof with obscene prices. they will crash through and crack their skulls in doing so.