Wednesday, September 19, 2007

Vote for me peasants, and stand to get a payout of $1111 forever!

TODAY reported the following exchange between Opposition MP, Low Thia Khiang, and Minister of Manpower, Dr Ng Eng Hen, apparantly during a parliamentary debate.

MR LOW THIA KHIANG (LEFT): Does the
Government of Singapore Investment Corporation
(GIC) use money derived from CPF to invest?


DR NG ENG HEN (RIGHT): The relationship is not
so simple. Let me give an example: You put money
in a bank and you agree that you’ll get
2 per cent. The bank publishes a report and says
that it earned 8 per cent. You go to the bank and
say, you want 8 per cent. It doesn’t work.
But the Government takes over the liability of
the CPF Board and promises a risk-free rate to
members. The market test is, if anybody
else thinks he can take on that liability, please
line up.


MR LOW: Is the Government short-changing
Singaporeans by giving CPF members a
3.5-per-cent interest rate, while the GIC makes
9 per cent and pockets the balance of 5.5 per
cent? Is the motive of delaying the draw-down
age to enable the GIC to have a readily available,
cheap source of fund to invest?


DR NG: If it was that cheap, we would have a line
of suitors waiting for the money. There are none.

See Singapore Peasants, here's what you get after paying millions for a minister. This is the kind of nonsensical reply you get.

"The relationship is not so simple. Let me give an example: You put money in a bank and you agree that you’ll get 2 per cent. The bank publishes a report and saysthat it earned 8 per cent. You go to the bank and say, you want 8 per cent. It doesn’t work.But the Government takes over the liability ofthe CPF Board and promises a risk-free rate to members. The market test is, if anybody else thinks he can take on that liability, please line up."

Classic bullshit indeed. Firstly, a bank does not force you to deposit your money with it. You have the choice of not putting your money in the bank!!! Secondly, CPF is not a bank. It is a tool to help poor peasants save up sufficient funds for retirement purposes. CPF is not created to allow GICs to have access to cheap loans so that they can generate huge profits. Or is it? And just because CPF promises a risk-free rate to members doesn't mean it has the right to stash away the extra profits. Peasants are forced to put money inside CPF. If CPF loses money, it should jolly well fork out the risk-free rate to members. If it generates sulplus profits, peasants have every right to demand that the money goes back to them. As for Dr Ng's "market test", i would be delighted to be able to borrow money at 2.5% interest rate. I'm sure everyone else would too. The freaking line will stretch from JB to KL and back to SG.

I think peasants should just vote for me to be their prime minister lah. I'll hire Warren Buffett, the legendary investor, to manage Temesek's and GICs' assets. With Singapore's reserves standing at around $300 BILLION, according to opposition politician Mr Goh Meng Seng, Warren just needs to achieve an annual return of investment of about 20%. That will give us $60 billion. Then we'll share this $60 billion amongst the 4.5million people living on our tiny island. That works out to be $1111.11 a month for each person! Even Foreign Talents are included in this calculation. That's how rich we are!

And here's the best part of the deal.Hehe. I'll just ask for a salary of 500k a month ok? Value for money don't you think? Everyone gets 400 plates of Char Kway Teow a month for free instead of having to FORGO plates of Char Kway Teow!

12 comments:

simple said...

It is typical for Minister Ng to answer in this manner. Just go back to recent dialogue on the 2% increase in GST rate. Such a swiping manner is a tactic to avoid discussing the real issue and shows also a bad attitude of not taking serious opposing comments seriously. Can he be serious when insinuating that people could queue up at CPF to borrow funds wholesale other than under the home ownership scheme?

You are right. NMP Siew and Low TK had also highlighted the same issue. So did 2 PAP MPs for Tampines GRC.

To add on your points, people of Singapore not only contribute to the CPF (to come to think of it the Govt contibutes zilt), we are also the Primary Stakeholders and collectively the owners of Singapore reserves. So we are in fact entitled to share in the net returns, or at least a good portion of that, from the use of our CPF funds, in the form of interest payments or otherwise. We are not merely "depositors" as in the case of banks to which we are merely customers and not stakeholders. But if any one of us owns shares in the banks, then we do get regular dividends, bonus dividends and shares, ie we enjoy profit sharing as well as capital gain when we sell the shares we own. As to taking risks, Singapore banks are top-rated and very safe and profitable long-term investments (over 30-40 years & any stockbroker can tell you how many thousand %).

In a broader perspective, are the majority of Singaporeans so ill-disciplined, reckless and immature that they must be nannied by the State from birth to death even in their life-long hard-earned personal funds. Or should we be beginning to question more deeply the ulterior motives behind public policies and impositions, especially of a financial nature. Are they really in the interest and well-being of the populace or are they for the convenience, and to ensure the success rates, of the admistrators and rulers

I must be stupid said...

Makes us wonder why we pay millions for ministers like Ng Eng Hen to skillfully sidesteps issues and give an irrelevant analogies.

As the saying goes "never trust a politician, only trust their interest". Perhaps that gives a clue as to what is going on behind the scenes. We can only speculate i guess.

James Chia said...

I am disappointed with this generation of ministers. They seem to lack reasoning powers. They certainly can't be worth millions.

I must be stupid said...

Hi james,

They are certainly not worth millions to us. As for whether they are worth their weight in gold to some other people, we can only speculate as well. Haha.

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