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9/29/2009

GIC $59b loss

The Wall Street Journal, 28 Sep 2009 SINGAPORE (Dow Jones)--Government of Singapore Investment Corp. suffered a loss around S$59 billion in the fiscal year ended March, making it one of the worst years for the sovereign wealth fund since it was established in 1981, a person familiar with the situation said Tuesday. "The equities investments suffered the most, followed by falls in property valuations. It was one of the worst years ever," the person told Dow Jones Newswires. Does anyone got a feel of what $59b means? If a private condo costs $1m each, $59b can buy 59,000 unit man. My guesstimate is that the sum of money could buy up all the HDB flats in Ang Mo Kio or Toa Payoh. That is what $59b means when translated to purchasing power. But no one is battling an eyelid for the loss of such a hugh sum of money. It is just paper money, some digits churned out by the accountant. On hindsight, GIC should have put in more money in CitiBank. If the investment in CitiBank was 10 times of what CIC put in, it could recoup $46b worth of profit in one go. Wouldn't that be nice? Ok, the initial collapse would mean many sleepless nights and shivering in cold sweat. But it would be worth it.

1 comment:

Matilah_Singapura said...

No problem lah. The govt can always bail out their own cock-ups by taxing the people more.

59 billion by 4.5 million people approximates 13k per person in bail out money to be raised, which is just over 1k per month per person, or around $33 per day.

C'mon sg.gov, you can do it!! The people are there for the sacrifice, for they get the govt they deserve -- and thus also get all the expensive govt cock-ups in the deal.