Monday, October 30, 2006

Chapter 3 : You are not your wallet.

Chapter 3 is the last spoiler that will be spoiled in the Singapore blogosphere and can be found here at Remaining spoilers will be made on this website instead.

Status Anxiety

John Koh, 26 loves showing his latest car to his peers. He eats at the best restaurants, lives at 6th Avenue, and his current hang out is being at Corduroy & Finch along Bukit Timah road (If only for a snack). Coming from a rich family, John does not really need to save to get his car or an apartment of his own.

His two friends, Gary Poh and Nigel Yong while not as well-endowed as John, have developed a different way of coping with the presence of someone truly rich in their company.

Gary always felt that he had to catch up with John to maintain their friendship. So he made brave attempts to emulate John’s spending habits, purchasing branded shoes while studying in JC and upgrading to a car the moment he got his first job. Gary always funded this lifestyle with debt. It seems that no price is low to keep himself ahead.

Nigel was much wiser. After all, if John were to despise him for being poor, he would not really want such a friendship anyway. Nigel was, thus, true to himself and kept his spending within his limits. Nigel knew that he brings something different to this friendship and see no need to emulate his well-endowed friend.

After years at work, the tide had turned. John kept the momentum of his wealth going but Gary had to bow out because he got into trouble with his creditors. Only Nigel, who was honest with his financial situation, could maintain the friendship with John, earning John’s respect for his down to earth nature.

Status anxiety is the first of your personal demons that you need to cope with. There is such a strong drive to keep up with the Joneses (or Johns or Tans or Lims) that we hurt ourselves in the purpose. The Chinese call this “Da2 Zhong3 Lian3 Pi2 Chong1 Pang4 Zhi3” or slapping your face swollen to imitate the appearance a prosperous (fat) man.

As mentioned in the earlier chapters meritocracies actually tacitly encourage such behavior because it makes people strive against their goals to accumulate material goods, the clearest measure of a man is money. Failures are a result of their own weaknesses and do not deserve any sympathy. The mass media exacerbates status anxiety by featuring perpetually young and beautiful people on TV prancing around in designer wear and continental cars.

Here are some ways to cope with status anxiety courtesy of the October 2005 issue of Psychology Today article by Carlin Flora:

a) Live in an area where people are nice and humble.

Very often, we surround ourselves by people who are very status conscious; it becomes a lot harder to be true to ourselves when everyone is doing the same thing. This is a problem of peer pressure.

This applies very well to young professional couples who opt to live in luxurious condominiums. If you are unable to cope with the excesses of your neighbors and find yourselves envious and keeping a lifestyle which you hate as a consequence of this, consider moving on to perhaps a HDB estate and living with people who are more likely to envy you. This has the added benefit of freeing up capital for your investments.

b) Become the king of your own hill

Happy people are those who generally excel in an area of their lives. To be happy and extract yourself out of a position of envy for your peers, it is very healthy to find a niche or a sub-culture that you absolutely excel in.

There are in fact many healthy niche groups that you can join and maybe even lead them if you are passionate about a hobby. You could join the Toastmasters public speaking movement and work in committees and help other people or you could become the best World of Warcraft player in Singapore. Joining a fringe group like the group that indulges in Anime Cosplay (no, the decent sort) or having any great hobby will get you to think about status anxiety less often.

c) Simply grow more white hair

You can simply grow older or wiser. Status anxiety or getting into pissing contests generally occur to young people who have just started work (somehow it always seems to infect young professionals fresh out of university). Starting a family and growing older will allow you to mellow down. The wisdom will create an automatic defense against the forces of envy.

d) Stop benchmarking yourself with others

In capitalist societies, everybody is comparing their situation to everybody else. Even authors want to know how their book is selling relative to other books in the market. One way is to develop a penchant for contrarianism. You have to really hate what everybody else is doing and enjoy simply being different. (Note that contrarians make a lot of money in the stock market as well because these are the kinds of folks who can buy low and sell high.)

Working in an IT company in a project management capacity exposes me to a lot of yuppie poseurs who carry the latest and greatest PDAs out in the market. To stop the habit of comparing myself with others, I bought a PDA holster, attached it to my belt and place a paper notebook and a pencil inside. I use it to track expenses and will detail this technique in a later chapter on Extreme Budgeting. It’s also an awesome way to break the ice with others who don’t expect someone from a high tech company to use a low-tech solution to manage their finances.

e) Realize that being part of high society does not equate to happiness

Happiness is being in an intimate relationship, having great friends and good health. Wealth, while important, remains a secondary concern. It takes a while to realize that and I have to grapple with this fact everyday. But always remember : After getting that Venti Rhumba Frappucino for a year in Starbucks, a 70 cent kopi-o would be refreshing to many drinkers.

Monday, October 23, 2006

Chapter 2 : Make Hay while the Sun Shines

The spoiler for chapter 2 of "Harvesting the Fruits of Prosperity" can be found in A blog which focuses on building enterprises in Singapore.

Here's the article :

Even better than having a credit card, cash, car, condominium and country club are the three E’s of Singaporean success.

Stanley Liew, 32, has everything to celebrate about. As recipient of a government scholarship to one of the top Ivy League colleges in the US, Stanley was not only able to have for himself a world class education, he was also to bask in the warm glow of being a prestigious government scholar in Singapore.

Of course, like many people who excel at looking out for number 1, Stanley was also able to break his scholarship bond with the help of his immensely wealthy family. After all, being a highly paid bureaucrat was attractive but not good enough for a man of his status. And after a very profitable 3 year stint as a management consultant, Stanley takes over his multi million dollar family business. His past as bond breaker is now readily forgiven, since he is now someone who is responsible for hundreds of jobs in Singapore.

You see fragments of Stanleys everywhere in this country. Sometimes they appear in the Singapore Tatler, sometimes they get involved in local politics. Stanley is the archetype of a successful Singaporean – all the woman want him and all the men want to be like him.

You can love the metaphorical Stanley. But very likely, you can also hate him. Stanley is the kind of person whom we need to cope with in a society which is rife with status anxiety and envy. People like Stanley challenge us because he forces us to come to terms with our own inadequacies and forces us to mature and mellow with the coming of age.

Thus, Singapore loves three kinds of people, and Stanley just happens to have all three of these traits. These traits are known as the three E’s of success. Without a doubt, the 3 E’s are much more important than the 5 Cs in this materialistic world that we live in.

A person with 3 Es is educated, endowed and enterprising.


Education is the carte blanche towards a good life but has seen a lot of decline over the years. Educated people hold the best jobs in the economy and do not really need to take a lot of risks to thrive in this world. Motivational books and books on financial planning will always play down the value of a good education in favor of being street wise but in reality, education confers many advantages which can be very unfair to every one else. In countries like Japan, seniors from top universities in Tokyo have been known to cover up the mistakes of their juniors because they came from the same institution as they did. French presidents almost always hail from the Ecole National d’Administration ( ENA ), an elite school which grooms the cream of French politics for a top role in French society.

Most motivation books succeed by attacking educated people but fail to qualify and explain why an education, may prevent a person from accumulating wealth. The main reason of the lack of success for some is not because of education but his lack of an ability to apply the principles towards his own success.


The other facet of success is an endowment. Successful people come from well endowed families because unlike the good old days having money makes a bigger difference in the lives of many school kids today. The best computers will allow them to keep in touch with the latest news on the internet; the best tutors will plug any of their weaknesses in class.

And the government encourages the transfer of wealth across generations. Singaporeans today are levied one of the lowest inheritance taxes in the world and the rich are lobbying to have these taxes scrapped. So the simplest secret to becoming wealthy may well be to be born into a family of rich parents.

Money can also be converted into human capital. In the good old days, we have a very standard education system designed for the masses to churn out obedient factory workers and employees. Nowadays the rich can tailor a private education for their progeny in the form of more private, independent or autonomous schools. This does not even consider the power wealthy families have to get business contacts for their younger generations of heirs.


Enterprising people are currently having their hey-day being touted and widely promoted by the mass media. Enterprising individuals are the new heroes of our generation, being able to become fabulously wealthy and be able to provide jobs for other people in this country. Increasingly, society wishes to groom a new elite in the form of entrepreneurs, but there is of course, a persistent dark cloud when it comes to starting a business. Business can succeed beyond the owner’s wildest dreams but it can also fail.

But some fail more painfully than others.

Brains can allow you to get cheaper funding for your business. Why do many venture capitalists cluster around universities waiting to pounce on the latest technological ideas? Money will give you a cushion to deal with the possibility of business failure. If you are rich, daddy can bail you out.

It’s easy to be enterprising once you have the other two Es in place.

Getting the three E’s in place

You can choose your reaction upon your realization of the three E’s in Singapore society. You can be cynical about it and withdraw from the game of Life or you can ask yourself the much more empowering question: “How can I attain the three Es in life ?”

As it stands, we do have some influence over how we attain these three facets of success. We can work hard to become educated. By studying businesses, showing an interest in people and taking calculated risks, we can become more enterprising. Many have risen from a humble background by saving and investing an endowment for themselves.

Thus, the rules of life do not change. It is your duty to play the game of life well no matter how well your starting hand looks like.

This way, while you may never be able to attain the success of folks like Stanley, we can come close to being able to do so and earn the admiration and respect of our peers.

Friday, October 13, 2006

Chapter 1 : Are you a scholar or a statistic.

The following snippet can also be found in the Mr.Wang's blog. Clearly the Blogosphere has a very intelligent and powerful presence which can be harnessed in the publication of my second book.

Here it is :

“You might as well show up with your salary printed boldly on your T-shirt. Save the women at SDU the trouble of asking.“, remarked a cynical male colleague when another fellow worker was talking about attending the next speed dating session organized by the Social Development Unit (SDU). In this country, even love and romance in are tainted by financial considerations.

Nothing seems sacred anymore.

June, 32 year old single lady, is a now an extremely unhappy single in Singapore. A local university graduate of a local university, sheJune joined the SDS in the hopes of finding an eligible man, someone humble and unassuming, not your typical a distant cry from the credit- card toting yuppie maen out on who throng Boat Quay on Friday nightevenings. The Social Development Services, being an organization which caters which caters only to matchmakesing non-graduates, did a spot check on her. They and found that she has a degree and promptly cancelled her membership in the organization. June now joins the ranks of thousands of graduates who infiltrate the SDS every year, only to be caught and kicked out of the organization after their graduate status is being discovered to be a university graduate.

In a study on marriage trends in Singapore by the population planning unit found in the Statistics Singapore website, 32.8% of female graduates aged 30-34 wereare single in the year 2000. This statistic has decreased over the previousast 10 years ( From 1990 ) all thanks to the sterling efforts of matchmaking organizations like the SDU. In contrast, 41% of males aged 30-34 with below secondary education are single. This is a whopping 3.8% increase since 1990 over the past 10 years.

Can we blame these men for being unwanted and feeling disenfranchised? Their only hope now of being attached comes from marrying foreign brides and this hope is being dashed by a policy which prevents foreign work permit holders from marrying local citizens.

The trends reflect the changing nature of Singapore society over the past 10 years. Graduate women have organizations built for the expressed purpose of finding their life partners creating a slow but steady improvement in marriage trends. Men with poor qualifications, however, will have to live their lives either being hopelessly single or taking a calculated risk with mail-order brides. In such a case, Thus we are seeing the effects of a meritocracy being pushed to its extreme logical conclusion - . A meritocracy when practiced to its extremes it evolves into social Darwinism, a term coined by Englishman Herbert Spencer, who espoused the theory that only the most capable humans weare chosen to dominate. Living in Singapore has become a game of the survival of the fittest. According to social Darwinists, the strongest or fittest should survive and flourish in society, while the weak and unfit should be allowed to die.
an enlightened society should weed out their unfit and permit them to die off so as not to taint the gene pool.

If you visit make some effort to surf, you’ll see that can find its mission statement sayswhich boldly proclaims that:

“We believe in our mission of promoting marriage among graduate singles and inculcating positive attitudes towards marriage among all singles in Singapore to achieve strong and stable families in Singapore.”

It seems to give the impression that the organization wants graduates to get married but other singles to simply appreciate marriage as a wonderful abstract concept.

In our push to do what works and reward those which we deemed as capable, we constantly run into the problem of determining what is best for us with crude and primitive benchmarks. In the above case, in oOur drive to create families with intelligent and capable children, we engineer a master plan to get highly educated people to marry each other creating some sort of a social stratification within our society. (“Does any one here belong to the Graduate caste?”, one might ask.)

Of course social Darwinism with myopic policy- making fails to consider excludes other more personal factors which may be quite significantdisrupt the authority’s ultimate objective of population growth. Perhaps some graduate women are have less willingness to play a nurturing role within the family and Asian men have already sensed that and subconsciously marry down. Perhaps children with graduate moms may also have to see less of their parents if both turn out to be who are high- flying professionals.

Thus In conclusion, the road to hell is paved with good intentions. In our drive to have marry two graduates marry each othertogether, we deny many children the opportunity to have at least one graduate parent to guide them along in their life journey. For now, we have to learn to be aware of the threat of social Darwinism and be mindful to defend ourselves against that.

And for June’s sake, could we please merge the SDU and the SDS?

Saturday, April 01, 2006

Library talk on April 1st 2006.

Just gave a library talk today on 1st April 2006 although its not an April Fool's joke.

Topic was on building a small nest egg of $10,000 and financial literacy.

Book introduced to the audience includes :

- The Richest Man in Babylon by George Clason
- The Millionaire Next Door by Thomas Stanley
- The Bogleheads guide to investing by Taylor Larrymore, Mel Lindaeur and Michael LeBoeuf
- Personal Financial Planning by Benedict Koh and Fong Wai Mun
- A Random Walk down Wall Street by Burton Malkiel
- The Intelligent Investor by Benjamin Graham.

In the next few weeks, expect to have some spoilers for my next book.

The manuscript is complete.