8/21/2014

CPF – The same logic is applicable both ways

There is this anonymous commentator in my blog that is very persistent with the govt’s version of ‘What if he spent all his savings after withdrawing everything from CPF?’ To this commentator, this is good enough reason for the govt to justify keeping all the retirees’, all not one or two that would squander their money away, money in the CPF and to decide how much and when to let them have some of the money to spend. By posing that question the govt is passing the buck to the people. You are now responsible for coming out with an answer if not it means the govt’s solution is the best, the govt has the right to keep your money.

This kind of ‘yeh mun’ (pronounce in Mandarin) logic is only sound as long as the person using it is in power. And it is a very dangerous logic as it can be apply to all kinds of flimsy situation to the disadvantage of the people. Why should not the same question be posed to the govt? Sure, and the govt will say that is why the govt has to keep the money for the people for their good.

Ok, don’t ask this question. Sure lose if the other side is ‘yeh mun’ type. The govt is so afraid that all the people will spend their life savings and ended up no money for retirement. If the govt can fear the people squandering their miney, can the people likewise fear the govt for squandering away all their money in the CPF? Is this a reasonable fear?

The govt is made up of people, ordinary people that the people elected to represent them in Parliament. If they are not elected, they will be just like you and me, as smart as you and me, or as stupid as you and me. And if we can squander our CPF money away, the same kind of people in the govt can equally do the same notwithstanding some of them may arrogate themselves to be immortals or super talents.

The people have many avenues to squander away their money. Sure, go to Batam, go drinking, go frolicking, go gambling. Does the govt have equal or more opportunities to squander the people’s savings away? I am not saying they will. But they make big decisions, they think big, they have big appetite, they like expensive toys, expensive mega projects, queer pet projects, like winning the World Cup or gold medals, hold big parties and celebrations, go overseas with all kinds of good reasons. And they invest very very big. A wrong decision, wrong timing, or being conned by snake oil sellers, can be very costly.

The people have all the reasons to fear the govt spending away their money too. That is why they are protesting at Hong Lim to want to know what is happening to their money. The people have all the rights to fear the govt as the govt is made up of ordinary men and women, not gods, not immortals, not infallible. They may want to pass the risk to so called foreign talents to manage the money. This is equally, if not more dangerous, as the people hired could turn out to be turkeys.

How much have the govt lost during the Lehman bonds and toxic notes crisis and the global financial crisis? Sure no small peanuts, but more like golden peanuts.

The question is, who should fear who, the govt fearing the people squandering their money or the people fearing the govt squandering away their money? Can the people apply same logic and same solution on the govt, to control the purse of the govt and only allow them limited money to spend just in case?

What do you think? The boys and girls in charge of your CPF money are infallible?


Kopi Level - Green

25 comments:

  1. I think the government argument is that they can not spend the reserve without the president approval so the reserve is safe with the government.

    The problem is the sovereign fund that can invest big and lose 60 billion during the crisis and reserve investment does not need president approval as this is their mandate. The conflict arises when the government and sovereign fund decision maker is the same set of people. The diff is government spent money and sovereign fund invest ( spent) money but conceptually there is a diff.

    I guess it's like me, I spent on mei mei $100 a week but I also view it as an investment in building relationship with mei mei in the hope that I get better service and sometime extra free service due to the long term investment. Tio Bo, you tell me lar make sense or not?

    ReplyDelete
    Replies
    1. 'yeh mun', me believes Rb meant '野蛮', in English it means unreasonable.

      Delete
    2. Anon 9.55am

      YEW are being "too gentle " with your translation.

      A more " closer " translation could be "BARBARIC" !

      Delete
    3. In Chinese, "野" means "wild" .

      "蛮" means "uncivilized"

      Combined together, translating it as "unreasonable" may be a "gross understatement ".

      "BARBARIC" could be a nearer meaning to denote "wild 野" and "uncivilized蛮".

      My Chinese also not so good lah.

      Pls feel free to disagree.

      Delete
    4. Losses is more than 100B. The CEO of S. Inc. can still come out and say nobody benefited from our losses. Does it instil confidence in you?

      Delete
  2. As shown by the last GFC (global financial crisis), the people lagi fear the experts in Lemon brothels, many giant financial and non financial institutions which would have gone bankrupt if not bailout by the people's monie$$$$$.

    The experts fear the people squandering their savings.

    The fear in the people is LIKELY EVEN GREATER that the experts might even "end up LOSING THEIR SHIRTS " and ultimately the people's "life savings "!

    ReplyDelete

  3. we have been talking about cpf
    issues for months.......

    cpf is a very good scheme......

    it is not the fault of the cpf
    scheme......

    why why why......

    the real issue is that people are
    using their cpf to the LIMITS to
    buy sky high homes leaving very
    little or none for retirement....

    if sky high property prices are
    not solved, no changes to the
    current cpf will help....

    get it................

    cheers.....

    ReplyDelete
  4. Well done papigs, keep it up

    Many dun appreciate your honorable efforts, but dun blame these daft. Because u know n label them such

    Keep it up, it will be appreciated in due course

    Leemember, voting papigs is korrect, god old fart kuan yew never wrong

    Huat under papigs

    ReplyDelete
  5. Gone are the days the experts can suka suka presume that are the experts?

    ReplyDelete
  6. Governments are only here to tax n spend..they've never been great at retaining wealth. Look at US or EU, the wealthiest citizenry far outweigh the achievements of their governments. At home, look at the achievements of our billionaires..don't they outstrip the government? Mah Bow tan's achievement is legendary ..public servant, yet through astute investments and savings amassed more than $25 million...can governments do that? Strip temasick of all the sweetheart deals n let's have a look at how they are performing ..the high profile yog expenditures and garden by the bay purely indicated that the wastrel ways of government far exceed Batam visitations by ah peks..can the government be trusted? They have gone back on their word..I won't trust them with used toilet paper..hehe

    ReplyDelete
  7. Yes Anon 9:55, that's the Chinese version. Thanks.

    ReplyDelete
  8. Aiya, anon 9.55am, just translate it into simple "poorleetickle" lingua lah.

    It's called "SUKA SUKA "?

    TIOK BOR?

    ReplyDelete
  9. That is why they have created this gambling mentality among Singaporeans to cement their arguments for keeping our CPF.

    What is the main reason or cause for the squandering of money? Gambling of course. Get rid of it and the problem is mitigated. How many meals can one have in a day, how many bottles of liquor can one consume daily, or how many mei mei's can one screw in a day? Wealth can hardly be squandered easily on such vices.

    Since time immemorial, wealth had always been squandered through gambling addiction. Yet we choose to build casinos and promote all forms of gambling with all the conveniences to participate. Put a fish in front of a cat and tell it not to eat the fish.

    ReplyDelete
  10. '野蛮' to me mean more unreasonable than the unreasonable and is the most unreasonable becos he or she has the most unreasonable reason to be the most unreasonable.

    ReplyDelete
  11. Anon10.36am // Put a fish in front of a cat and tell it not to eat the fish. //

    Tiok.

    Same same try put a naked mei mei in front of a DOM.

    Sure "流鼻血"!

    ReplyDelete
  12. 10,36 very tiok the only way to lose your money is gambling. Because food and drink are limited by the size of your stomach and screwing Mei Mei is limited by your balls reserve. Eg if you have 100 million u think u can screw away all your money at $100 per pop. It means one million screws and assuming u can screw 2 times daily that translated into 500k days or about 1400 years way longer than human life span leh unless u think u can live forever

    ReplyDelete
  13. A good example of '野蛮' reasoning is to claim that a few persons would squander their savings away and apply it on a few million people that they would do the same and don't accept any other possibilities. Don't listen and don't give people a chance to say otherwise.

    ReplyDelete
  14. When the poor gets poorer, they cut down on items such as household items, clothes, even buying less food and the cheapest they can find.

    But when the money gets transferred from the poor to the rich's pockets, it is unlikely they spend the additional money on food, essentials etc. Usually the money is saved.

    The overall multiplier effect in the economy falls due to higher withdrawals in the circulation in terms of higher MPS, lower injections in the flow in terms of lower MPC.

    Though, SINKIELAND consumption component is much smaller than countries like the United States as a proportion of GDP, nonetheless a shrinkage of per capita private consumption reflects shrinking income of the poor.

    Wealth is being transferred from poor to rich.

    Income inequality widens.

    But according to GCT logic, no matter how big this income divide and stratification is, the garment is the papa and the people must subject themselves submissively to the leegime and cannot show them the "middle finger "

    ReplyDelete
  15. Gong Char Tow where got logic.

    What he did or said always shot down by lower ranked immortals. So, his logic, if any, counts for nothing.

    ReplyDelete
  16. Actually the solution is very simple. Its just like what if your house catches fire, breakin, destroy etc. Just need to set up an insurance fund against such what-ifs.

    ReplyDelete
  17. Sure or not?

    1 TRILLION investment how to insure?

    Can pray tell which insurance company can "makan" such a insurance policy?

    ReplyDelete
  18. Hahaha

    Trust that that insurance company will come up with an exclusion clause that clearly excludes the 'what-ifs'.

    Then they will surely makan one. Not only that, all insurance companies will jump on the gravy train. Insurance companies love 'pau chiak' type of business.

    ReplyDelete
  19. This comment has been removed by the author.

    ReplyDelete
  20. RB fear that the government will squander when they are desperately trying to cover the big hole of their investment losses? They may be fearing that they cannot cover in time before a new government takes over and they are brought to account and a new law to claw back their bonuses.

    ReplyDelete
  21. Why need to have insurance companies as middle man to make profits?

    ReplyDelete