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2/07/2010

When will the balloon burst?

There are many things that we are paying through our nose and are taken for granted as our way of life. The question is whether we should be paying so much for them, and if we can afford to key paying for them. Our housing is going the way of Hongkong and Tokyo. Our cheap public housing is no longer cheap anymore. And we will make them more expensive for the good of the people who have bought them. But someone must pay for it and keep the balloon from its unstoppable inflation. We are paying for cars that cost about one third of its import price. For $50k or $60k, we could be driving much bigger and more luxurious made cars. Or we could be driving the same cars and saving a fortune from it. How much does a Toyota or Honda cost really? And how much is a Mercedes or a BMW? Are we being shortchanged? And our medical cost is skyrocketing like hot air. Funny thing is that there is a ruling against doctors overcharging their clients. The complicated surgical procedures and the expensive and sophisticated equipment will add to the cost. What about cough and colds, tooth extraction or fillings? The way it is going, another big chunk of our income will have to be set aside to pay for medical cost. Then we have to pay astronomical salaries to ministers, and some are still complaining. But this is the cheapest to pay for. Just one plate of kway teow or maybe add another plate every time they increase their salaries will solve it. This one is cheap really when the cost is spread around to every Singaporean. The good thing is that Singaporeans can afford to pay for all the extraordinary costs of things which need not be. And there is no fear of the balloon bursting as long as we can keep paying our people more and more salary to feed all the high cost items. Can we really continue to pay our workers higher and higher salary in a competitive and interconnected world? Why should our cleaners by paid $1000 pm when other countries are paying them $300? Why should our average workers by paid $2000 pm when others are paid less than half of that amount? Can productivity really solve this imbalance? Use more machines and computerisation and lesser manpower? Starting from the worker's level, once they cannot feed the system to pay for their cost of living, the effect will be felt to the next levels. But some levels will be so insulated that nothing will happen to them even if the dam breaks. For now, the magician and his magic wand is still doing wonderfully and paying for ever more expensive items for a living seems to be easy.

5 comments:

Anonymous said...

Pray that the balloon does not burst hor! 90% of Singaporeans' life savings are invested in HDB and will be wiped out if the balloon burst.

God bless Singapore. We will need that eventually.

Wally Buffet said...

What puzzles me is that with all this talk about economic hardship, people are still thronging the malls and the mantra is buy, buy and buy. At the restaurants, standing room only and it's eat, eat and eat.

Am I missing something or are the policies that are being dictated to us are in fact working?

Chua Chin Leng aka redbean said...

Wally, not everyone is suffering lah. And the buy, buy, buy come from the younger group that are still single and not having to pay for the millstones on their necks and no need to contribute to the family expenditure. Earn how much, spend how much. Go to any shopping centres and you will see on young and happy faces. The oldies are none existence.

Anonymous said...

It's true what you said above, Redbean. Nowadays, consumption habits are different from our generation of the 40's and 50's.

Then, when we want something, we save and only when we have saved enough, we buy. To the younger generation, uncles are out of date with finances.

Nowadays, it's borrow to buy first, then save to pay. To the younger people, it may be too late to wait because the argument is that there may not be a tommorrow.

Now, what is going to happen if nothing happens tommorrow and they live to the ripe old age of, say, 85 with little savings? Approach the Government for help?

Who has the correct attitude?

Anonymous said...

Soon, my friend.