3.3% better than 4%?

CPF pegged to bond maybe unfavourable to the oldies Citi economist Chua Hak Bin has come out with a different calculation on the peg and suggested that the pegging to bond rate would benefit the young rather than the oldies. His numbers showed that in the longer term, the young could get 3.7% while the oldies will only get 3.3%. Now is that good or bad? So far the official explanation is that pegging will give more in returns to the CPF holders. And is 3.7% or 3.3% better than 4%. I know the answer. Yes, with a lot of faith. Chua Hak Bin better make doubly sure that his numbers are correct or he will have to retract them soon.

More leeways for Singaporeans

Aren't Singaporeans glad that they are having more leeways, according to Dr Gillian Koh, 'a view echoed by former Ministry of Information, Communications and the Arts director and Member of Parliament Baey Yam Kheng. In Dr Koh's view, civic society groups are now allowed to express more and at times more than political groups. She cited the little protest by children at the Youth Park to protest against anime distributor Odex as a big leap forward. What the handful of children did was to display some of their toy characters. And they were so lucky that the law gave them a lighter touch by just taking down their names. Nobody was arrested. Great progress! Singapore society is maturing. Hmmm, I thought in mature societies, they would not even be bothered with children playing with their toys. I may be wrong. But it is always good to start a day with such positive news like having more leeways.

Another boom town charlie story

The rental business is so good that all the property owners are rushing to raise their rentals by 2 or more times within a year. It is a situation where the lessee must grab a property and quickly sign on it for as long a term as possible at a fixed rate. If not, someone will sneak by and offer to pay more or the landlord will keep raising rentals every few months. How many properties that I own? One 3 rm flat. But still good if it can fetch $2000 a month rental for my retirement. With private property prices and rentals shooting to the sky, some must filter down to the heartland. This is the best thing that can happen to Singaporeans as practically everyone own a little flat, maybe not in prime district and cannot fetch $5k or $10k, but $2k is more than good enough if the annuity is going to pay $300. Thank god that things are working out this way. All singaporeans can retire happily and with a nice little income. With $2000 pm, they can keep their annuity programme.

Privatise Annuity Scheme

The idea of a compulsory annuity scheme for all CPF holders at 55 is a juicy dream. One can get even wet by simply thinking of the amount of money to be had. At $10k each and an average of 30,000 contributors, that is $300 mil annually. And this amount is for safekeeping for the next 30 years when the first payout is due. Multiply this number by 30, without talking about interest and investment returns, that is a whopping $9 billion in cash to play with. The management of this scheme should be privatised and open to the highest bidder. That will ensure that the investors will get the best returns. As we all know, only privatisation can ensure efficient management and good returns for the shareholders. I will bid to pay any surviving investor at age 85 a sum equivalent to 5 times his initial contribution at 55, or $50k for $10k invested. Alternatively, the investor can be paid $500 monthly for the rest of his life. And I am prepared to bid higher, maybe $60k or $600 pm. What is the catch? I think 70 or 80% will not live that long. And for those who don't survive, all his contributions will be forfeited to benefit the survivors. Secondly, it is a pyramid scheme where they will be new contributors paying every year. And yes, as mentioned above, the number of those dying before 85 will be so comfortable and their unclaimed investments will definitely be enough to be shared around to the survivors, generously. 30 years of collection without payout is too good and sexy a proposition.

Boom town charlie in paradise

'Wages rising faster than at any time since 2000. By Goh Chin Lian in the front page of The Straits Times Labour short bosses are raising wages fater than at any time since 2000, but the good times for workers could dent Singapore's competitiveness. Workers' earnings have recorded a year on year increase of 8.5%, the largest rise since the economic boom seven years ago. Labour experts are worried that the higher labour costs could put a dampener on the economy....' The good times are here. With 8.5% rise in wages, whew, if one is earning $100k a month, that is $8,500 increase a month. Not bad huh! And if one is earning $1000 pm, it still works out to $85! Now take away 2% of GST and another maybe 10% for unofficial GST due to profiteering, is it still ok? And don't forget all the increases in fees and charges and prices. How many percent would that come to?