Below is my letter to MAS in response to their open call for feedback from stakeholders in the stock broking industry.
PM Lee Hsien Loong
DPM/Finance Minister Tharman Shanmugaratnam
The MD MAS R Menon
CEO SGX Magnus Bocker
5 Mar 14
The Stock Market is NOT fine. It is no longer a level playing field and
has been redesigned for unfair trading in favour of computer trading.
(This two line statement is a summary of this paper)
This is an open letter to the above gentlemen and will also be posted in my blog, www.mysingaporenews.blogspot.sg/.
The Stock Market is not fine contrary to what was stated in the
discussion paper issued jointly by the MAS and SGX. The condition of the
stock market is dire, in a state of denial and slipping into a coma.
Yes, the trading volume gives an impression that it is healthy and
active. The revenue and profit of the SGX suggested that all is fine and
presumably the market will continue to function in this manner for a
long time to come, with the SGX chalking up good revenue and profit as
it gets along. It is NOT. There are hardly any retail traders in the
market. Why?
The Stock Market is not only the SGX. It has other players and
stakeholders. And all is not fine except for the SGX and the computer
traders. Some of the front line soldiers, the remisiers, are earning
less than what a cleaner or security guard is getting. Younger remisiers
have already left the industry or seeking employment. Only those that
could not find alternative employment are sticking it out and waiting
for the broking houses to ask them to leave.
The retail traders have fled from the market.
With this pathetic level of commission, the broking houses too would not
be able to sustain their operations at the current scale and would soon
have to downsize and retrench staff. The supporting staff will have to
go and overhead cuts. Some may want to get out of the business too.
For companies listing in the SGX, soon they will realise that it is a
waste of time when the value of their shares are near to worthless. It
is a joke that the prices of stocks in the main board of a regional
financial centre with big ambition can be less than 5 cents or even
worse, less than 1 cent. And this is not an exception.
What is happening to the Stock Market? What are the causes that led to
this dismal state of affair? Some stakeholders will still swear that it
is fine. They will not want to see the elephant in the class room. What
is that?
The culprit that is causing the demise of the Stock Market is not contra
trading as they would want you to believe. Excessive contra trading and
speculations need to be moderated but not to be wiped out. They are the
soul and spirit of a small market. Without contra trading and
speculations you will have a market the size of a pea.
The Stock Market today is not the traditional stock market that we knew
before. All the principles and fundamentals of a traditional stock
market have been violated and cast away. The Stock Market we have today
is nothing but a casino in disguise but without the strict regime,
regulations and controls of a casino.
The SGX has been reorganised and redesigned to allow computer traders
using high speed sophisticated computer systems to trade against
unsophisticated investors or even big funds still trading on
fundamentals and believing that they are investing in the long term.
Rules and processes have been changed to facilitate computer trading to
be more effective and efficient, taking full advantage of computer
power, time and speed, and financial resources to cream the market, to
trade against investors without the benefits of these computers.
Continuous trading with no lunch breaks, small board lot size, minimum
bid size, script borrowing, keying in of short positions, etc etc were
all created to favour computer trading against other traders.
High speed computers of computer traders are plugged into the SGX system
to have access to information of other traders and their positions and
simply trading against them with no regards to the fundamentals of the
stocks. Computers trade for profit by buying and selling against the
rest of the investors, often depressing prices of stocks against their
real values. They have cleaned up the traders, big and small, and not
many are left with money to lose.
Put it simply, computer trading is unfair trading, unfair advantage. It
violates all the fundamentals, principles and regulations of the SGX to
provide a level playing field and fair trading to all the players. How
could this be allowed by the SGX? This is criminal.
I am not making any suggestion or recommendation as to how to save the
Stock Market. The solutions are obvious but no one wants to see or do
the right thing. The invitation for the public, the uncles and aunties
for their recommendations to improve market activities, but creating an
unfair and uneven playing field, reflects two things. One, they do not
see anything wrong with the current system. Two, they are not serious.
The problems in the industry and the Stock Market are very serious and
highly technical. You need experts and professionals who can understand
what is happening and the complexities of the market mechanism to know
what is wrong and what are needed to put things right.
If you get the picture, and see the problem and want to do something
about it, it is best to set up a COI of experts who not only know what
they are doing but have the heft and confidence to change what really
need to be changed. You would need people like Paul Volcker or some real
foreign talents who are critics of the existing flawed stock market
system to tell the truth about the unfairness of the system. The
advocates of the system will not volunteer to tell you what is wrong
with the market and the system. They will say it is fine. This is how
far I am prepared to comment.
For a ‘nobody’ to make suggestions is not only rude but a waste of time
when the believers and converts of the current system could simply throw
the paper into the waste bin. You need a COI of professionals to make
real changes, failing which you can wait to bury the Stock Market in a
year to two.
If you have bothered to read this far, there is some hope that the stock
market industry can be saved. And I thank you for your patience and
trouble to hear me out.
Thank you.
Kopi level - Green
3/05/2014
Why Russia invades Ukraine?
The ouster of pro Russian Ukrainian President Viktor Yanukovych was
unacceptable to Putin. He cannot accept the loss of another pro Russian
state to the hands of the USA. Putin needed a good excuse to move in to
keep Ukraine under the sphere of Russia.
His excuse was simply to protect the ethnic Russians in Ukraine, comprising 50% of Ukraine’s population. This may or may not be a legitimate reason but a good enough reason for a powerful state to use as an excuse to invade another nation.
We have a large foreign population among us, all in hundreds of thousands from the PRC Chinese, India Indians, Malaysians, Indonesians and the Pinoys from the trigger happy and most powerful Asean country, the Philippines. Any of these countries, if powerful enough, could use the excuse of protecting their citizens here to invade us.
We are lucky that this would not happen. Not that they cannot find an excuse. We have the most powerful military force in the region and we can take on anyone. And we also have the backing of the Number One superpower, the USA behind us. So we are safe as long as the Americans don’t have a reason to want to invade us. Anyway, they are already here, so there is really no need to do so.
The only time when we have to worry about the Americans is when we become too close to China or Russia. Then the Americans could use the same excuse, to protect their citizens and also their investments here to invade us.
In the game of big power politics, we can become a pawn to any of them. The current geopolitical equation may make some think that an invasion is very unlikely, just like the invasion by the Japanese from Northeast Asia, so far away, and not really that powerful compares to the big powers today.
We are very safe, even with so many foreign nationalities living here. Our presumption is that it is exactly because they are here that their countries will not invade and destroy their investments here. Makes sense right? No? It gives them more reasons to covet the island, a prime asset without anyone interested in wanting ownership. In fact it seems that the owners are so willing to share, to give it away.
Let me quote Bilahari Kausikan in his article in the ST today. 'Do not just listen to the sweet words of foreigners, however pleasing to the ear. We must calculate our own interests as clinically as we can and not let anyone beguile us into believing they know better.'
His excuse was simply to protect the ethnic Russians in Ukraine, comprising 50% of Ukraine’s population. This may or may not be a legitimate reason but a good enough reason for a powerful state to use as an excuse to invade another nation.
We have a large foreign population among us, all in hundreds of thousands from the PRC Chinese, India Indians, Malaysians, Indonesians and the Pinoys from the trigger happy and most powerful Asean country, the Philippines. Any of these countries, if powerful enough, could use the excuse of protecting their citizens here to invade us.
We are lucky that this would not happen. Not that they cannot find an excuse. We have the most powerful military force in the region and we can take on anyone. And we also have the backing of the Number One superpower, the USA behind us. So we are safe as long as the Americans don’t have a reason to want to invade us. Anyway, they are already here, so there is really no need to do so.
The only time when we have to worry about the Americans is when we become too close to China or Russia. Then the Americans could use the same excuse, to protect their citizens and also their investments here to invade us.
In the game of big power politics, we can become a pawn to any of them. The current geopolitical equation may make some think that an invasion is very unlikely, just like the invasion by the Japanese from Northeast Asia, so far away, and not really that powerful compares to the big powers today.
We are very safe, even with so many foreign nationalities living here. Our presumption is that it is exactly because they are here that their countries will not invade and destroy their investments here. Makes sense right? No? It gives them more reasons to covet the island, a prime asset without anyone interested in wanting ownership. In fact it seems that the owners are so willing to share, to give it away.
Let me quote Bilahari Kausikan in his article in the ST today. 'Do not just listen to the sweet words of foreigners, however pleasing to the ear. We must calculate our own interests as clinically as we can and not let anyone beguile us into believing they know better.'
More coverage on the Little India COI?
We have had several days of furious reporting on the proceedings and
revelations of the Little India riot by the COI. The committee had a
field day expressing great admirations to individual bravery and
frowning at some acts of ‘cowardice’, not sure if this is an appropriate
word to use. And there were suggestions of what would or could be done
better. It was all about how the rioting could not have happened if the
accident was properly handled, nipped in the bud by properly trained
personnel who somehow failed to do so. There were so many
disappointments on how the men in blue handled the incidents. And one
striking moot point was the choice of not firing a warning shot that
could have made a great difference.
Then the reporting in the media stopped. No more coverage. No more revelations of bravery and shortcomings and misgivings. What happens? No more COI, or is there an adjournment and we would hear more of juicy details later on? I am really looking forward to the interesting revelations and commentaries from the eye witnesses and the experts. And I must say I am not disappointed.
There was an adjournment and the COI continued with more aggressive bouts of verbal tussle between the committee and the witnesses. Yesterday was more between former Commissioner Tee Tua Bah and current DAC Lu Yeow Lin, a contest between the veterans who have been there, seen it and done it, full of valour and experience on one side, and top scholars, full of talent, meticulous and well honed technical skills and with modern management skill and expertise on the other side.
The veterans believed in actions, go in and get the job done quickly. Think later or think quickly. The new technocrats, careful, measured, situation appreciation, considered the lives of bystanders, officers and not wanting to aggravate a bad situation. It was all cool, calculative and thoughtful decision making. The veterans did not favour such an approach. Too slow and could even be the cause of emboldening the rioters. The new talents disagreed.
How would the situation be like should the veterans be in charge is a iffy thing. It could lead to even bigger riot or the rioters could scamper and all arrested on the spot with minimum fuzz.
The outcome could actually be extrapolated from the assumptions of the rioters. One view is that the rioters are like innocent and nice school children. If this is so, the aggressive and swift ‘nip in the bud’ approach of the veterans would surely do the job. Actually, if the rioters were like school children, they could send in a team of police women, as long as they are tougher than the female bus attendant, would do the trick. Just give the rioters a few pushes and they will all fall on the ground.
On the contrary, if the rioters were wild and untamed beasts, like how they beat up the bus attendant and driver and some policemen, and burning of police vehicles, a rough handling could actually go the way as described by the new talents, bigger riot and burning of Little India.
Between the veterans and the new talents, who is wiser? Which approach is the better one? Can we develop a computer game to offer the different possibilities and scenarios and see how they run out?
What do you think?
Then the reporting in the media stopped. No more coverage. No more revelations of bravery and shortcomings and misgivings. What happens? No more COI, or is there an adjournment and we would hear more of juicy details later on? I am really looking forward to the interesting revelations and commentaries from the eye witnesses and the experts. And I must say I am not disappointed.
There was an adjournment and the COI continued with more aggressive bouts of verbal tussle between the committee and the witnesses. Yesterday was more between former Commissioner Tee Tua Bah and current DAC Lu Yeow Lin, a contest between the veterans who have been there, seen it and done it, full of valour and experience on one side, and top scholars, full of talent, meticulous and well honed technical skills and with modern management skill and expertise on the other side.
The veterans believed in actions, go in and get the job done quickly. Think later or think quickly. The new technocrats, careful, measured, situation appreciation, considered the lives of bystanders, officers and not wanting to aggravate a bad situation. It was all cool, calculative and thoughtful decision making. The veterans did not favour such an approach. Too slow and could even be the cause of emboldening the rioters. The new talents disagreed.
How would the situation be like should the veterans be in charge is a iffy thing. It could lead to even bigger riot or the rioters could scamper and all arrested on the spot with minimum fuzz.
The outcome could actually be extrapolated from the assumptions of the rioters. One view is that the rioters are like innocent and nice school children. If this is so, the aggressive and swift ‘nip in the bud’ approach of the veterans would surely do the job. Actually, if the rioters were like school children, they could send in a team of police women, as long as they are tougher than the female bus attendant, would do the trick. Just give the rioters a few pushes and they will all fall on the ground.
On the contrary, if the rioters were wild and untamed beasts, like how they beat up the bus attendant and driver and some policemen, and burning of police vehicles, a rough handling could actually go the way as described by the new talents, bigger riot and burning of Little India.
Between the veterans and the new talents, who is wiser? Which approach is the better one? Can we develop a computer game to offer the different possibilities and scenarios and see how they run out?
What do you think?
World’s most expensive city!
We are the most expensive country in the world to live in. And we are
trying to attract our citizens overseas to return to sink root here. I
am wondering aloud if this is another wayang or for real. We are so
expensive in two big ticket items, housing and cars. How are we going to
tell our Singaporeans to come back home to live and work here when they
have to pay a ransom just to get a roof over their head and a decent
car to enjoy the good life? Or maybe the target group is the low earners
that are eligible to buy HDB.
How are they going to tell them that when they returned, because of their higher incomes, they cannot buy public flats but pay a few millions to buy private properties?
These overseas Sinkies are living in big houses, landed properties that cost less a HDB flat and owning cars that cost a fraction of a small Japanese car here. They could afford two or more cars in where they are living. Why would they want to trade their good life to live in the world’s most expensive city and pay a bomb for a tiny flat and a tiny car?
Are you people real? Are you people thinking? Are you people asking too much from the overseas Sinkies? Are you nuts? Or do you think they are nuts? Or maybe they are so excited to want to live in the world’s most expensive city.
A country that refuses to sell public housing to its own citizens for whatever silly reasons when housing prices are sky high is a SICK country run by sick people. Period.
Kopi level - Yellow
How are they going to tell them that when they returned, because of their higher incomes, they cannot buy public flats but pay a few millions to buy private properties?
These overseas Sinkies are living in big houses, landed properties that cost less a HDB flat and owning cars that cost a fraction of a small Japanese car here. They could afford two or more cars in where they are living. Why would they want to trade their good life to live in the world’s most expensive city and pay a bomb for a tiny flat and a tiny car?
Are you people real? Are you people thinking? Are you people asking too much from the overseas Sinkies? Are you nuts? Or do you think they are nuts? Or maybe they are so excited to want to live in the world’s most expensive city.
A country that refuses to sell public housing to its own citizens for whatever silly reasons when housing prices are sky high is a SICK country run by sick people. Period.
Kopi level - Yellow
US militant doctrine of permanent warfare for world domination ( PART Two
USA evil doctrine of permanent warfare for world dominance.
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US state organised terrorism did not start only after the Second World War. American terrorism is and has been an extension of Imperial British terrorism which terrorised the whole world from the 1600s AD to 1960sAD. Under British terrorism , wars of aggression and harassment were carried out symstematically and natives of conquered lands were brutally massacred or genocided. When US got its independence from England it consisted of only thirteen states and it existed among the many self governing or semi-independent native Indian states in North America. However from the first day of its independence US systematically carried out brutal wars of aggression against these native Indian states and destroyed them one by one and killed , murdered or genocide eighty-five million or ninety-five percent of the native population. US brutallity knew no bounds and its savage and wanton treatment of natives even outdone and exceeded that of its British forbears. Thus the whole of North America with the exception of Canada eventually came under US rule. US then systematically and yearly carried out a mass system of populating the conquered native lands with millions of white immigrants from all corners of Europe.
US did not stop its wars of aggression after taking over all the native lands in North America. It justified its conquests and complete destruction of the natives by quoting the Bible in saying their Christian God did not keep these rich and resourceful lands for the "savage natives" but God has meant it to be reserved for "civilised White Men". Now who are the savages and who are the civilised people? You judge for yourself. US then turned its wars of aggression against Mexico. It always created border incidents to justify its aggression. Thus in between 1840s to 1890s US attacked and invaded Mexico and eventually occupied more than one million six hundred and sixty-five thousand square miles of Mexican lands which now comprise the states of Florida, Texas, Utah, Colorado, New Mexico, Wyoming and California.
After annexing more than two thirds of Mexican lands US focus its wars of aggression across the Pacific Ocean. It attacked and took Hawaii by force in between 1905 to 1940s. The natives of Hawaii fought the barbaric Americans bravely and only gave up after hundreds of thousands of native Hawaiians were killed and slaughtered. US then went on to depose the Hawaiian queen and eventually annexed the group of Hawaiian Islands to America. Just like in North America, Hawaii is now occupied eighty per cent by white men. There is another native islander kingdom called Guam across the other side of the Pacific Ocean in the east and this island kingdom would eventually suffered the same fate as Hawaii. Guam is now a major American military base. From Guam the Americans are now posturing its aggression against China. It had earlier used Guam for operation as a major military base for its war of aggression against Vietnam in the Vietnam Wars of 1965 to 1975. After taking Hawaii and Guam US went on to occupy and mopped up many other small islands in the Pacific Ocean.
Who and when will the Evil Empire's savage aggressions be stopped?
Southernglory1
Wednesday, 5th March, 2014
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