Sunday, October 10, 2010

Presentation at Bar Camp 6 - Quarter Life crisis

Bar Camp 6 was a blast. I made a presentation entitled "The Quarter Life Crisis".

Too bad my laptop which runs Ubuntu would not project itself to the audience but thankfully I rehearsed my presentation a number of times and could run without the slides. For the benefit for the folks who might not have managed to understand the gist of what was presented, here are the points I raised.

1. Gen-X and Gen-Y have a different expression of the quarter life crisis. For Gen-X, the conflict is between isolation and intimacy. This means that resolution would mean finding someone to settle down with. Gen-Y's crisis is a conflict of role versus identity, many young people feel that they want something else out of life than the current jobs they have. The talk focuses on Gen-Y's quarter life crisis.

2. Human capital, or the present value of unearned income can shed light on important life decisions.

3. Human capital is increased by obtaining more qualifications, astute career management or monetizing your hobbies.

4. Human capital is protected by life insurance.

5. Wealth can be given away in financial capital ( assets ) or human capital ( creating a trust structure to insist on providing education for beneficiaries ).

6. Illustrations were supposed to be done using a demonstration of online tools at but this did not take place so results were narrated to the audience.

7. First illustration is about a diploma holder who wants to get a degree. The change in human capital for a $20,000 degree can reasonably be as high as $1.1 millions dollars. This supports the idea that education is very often the best for of investment.

8. The second illustration is about a executive who wants a mid-career change to become a lawyer. The change is even more dramatic, enhancing human capital by $1.5 million dollars. But as the retirement age is reduced from the earlier assumption of 65, the value of the career change becomes smaller. To succeed as a lawyer beyond his current circumstances, he needs to work up till the age of 52 to "break-even".

9. The third illustration is about a banking IT professional who wants to risk everything to join a startup. The cost to human capital was found to be high and up till $1.2million of losses can occur. But it was emphasized that there is no price for self-actualization and people have a right to pursue their dreams.

10. Marriage is generally positive to a couple's finances dues to economies of scale and diversification in the couple's human capital pool.

11. Each child was estimated to reduce human capital by $250,000 but it was emphasized that children produce services and comfort at old age which can be beneficial to the parent.

Saturday, September 25, 2010

What's marriage really competing with ?

When the government said that they want to have a sustained campaign to promote marriage to younger folks, a lot of folks took the opportunity to start whining about why Singaporeans are choosing to accumulate wealth over settling down.

I don't agree with this line of thought. This light of thought has been used in many scenarios.

Why are Singaporeans rude to each other? Because they are too concerned about money making.
Why are Singaporeans not getting married ? Because they are too concerned about money making.
Why some people are failures can't hold onto decent jobs ? Because other people are too concerned about money making.

I beg to differ about money making because, very often, guys save money in order to settle down and start a family. If marriage gets delayed, it is because we're not saving fast enough.

Wealth reinforces families and makes development possible. Wealth accumulation is not the enemy of family creation - it is an enabler. And vice versa. Married people pool assets creating a portfolio of financial and human capital that is more diversified than that of 2 singles. Marriage raises conscientiousness of males resulting in better overall health, longevity and wealth creation. Children, while a burden when young, provide income smoothing at the late stage of a person's life.

There is enough literature to establish marriage as generally a positive stabilizing influence on personal wealth.

Now let's talk about the real issue of Single-hood.

Marriage has to compete with the one valuable resource singles have can may not be as willing to give up easily - Freedom. Being single is just plain fun !

Many singles make enough to lead decent carefree lives. They can travel anywhere, buy whatever they want. Promote causes that they believe in. That translates to a whole lot of mobility. Generation Y would also not want to be shackled by the norms of Gen X society, they want to carve a set of values for their own.

In this world of readily available sex, tweets and Facebook, I'm betting that it'll be hard to sell the younger folks an ancient institution like marriage.

What price are we putting on their personal freedom ?

This leads to my very dark conclusion for policy makers.

What will happen when the campaign fails ? What will the PAP do ?

I would propose more draconian measures. Let me give you guys a small hint :

Since children produce income smoothing in most cases and function as annuities, CPF Life can be opted out by parents living with their kids.

I'm sure our government can do something along these lines...


Saturday, September 04, 2010

How to study engineering ?

A number of readers may be engineers who want to get into investing so do comment on this article whether you agree or disagree with it.

A friend wanted to me to give some advice on how to study engineering. In particular, would there be fundamental ideas and equations that can make a person a good electrical engineer.

I can't answer that question directly. Like finance, engineering is a mixture of disciplines. Engineers need a strong foundation in mathematics, physics and computing before you can really start doing work in research, programming and systems integration. Finance majors need statistics, accounting and economics to even start making meaningful investment decisions. Finance majors in the future probably need C++ programming to engage in statistical arbitrage and high-frequency programming.

What I can offer is a set of strategies on how to study engineering that is unique in the physical sciences and not anywhere else.

Here are my tips :

a) Study of engineering subjects always involves solving problems.

You can understand or memorize an equation or physical theory but the rubber meets the road in solving problems. This is why sometimes great engineering students look at a typical problem in a tutorial first before diving into the lecture notes. Equations and theories exists as a means towards the ends which is to resolve a technical problem.

This means that the much-maligned 10 year series method of learning is actually the ideal one to master engineering subjects.

A savvy engineering is always hunting for new problems to solve using their newly learnt theories.

b) Best engineers use their foundation in problem solving to imagine or invent more complex problems.

This is the difference between a B student and a dean's lister - the ability to imagine problems of greater complexity and solve them independently of the lectures. We all learn about resistors in series or parallel in secondary school. A smart physics student can mentally arrange resistors in a three-dimensional cube edge or a mesh and use the basic equations to solve problems of this complex nature.

c) Best engineers have toys which reinforce their understanding of technology.

Engineers must align their hobbies with their discipline. This allows them to gain a kinesthetic understanding of the technologies needed to create value for their employers or clients.

If finance lets you buy the biggest toys, engineering is the professional discipline with the most absorbing toys.

The modern engineering student has a really nice set of toys to play with outside school. Find a VC trained in finance who likes the stuff you build and he'll then proceed to buy you even more toys. Android phones are programmable in Java. Arduino is a very simple, low-cost way to understand micro-controllers. Even better, Android phones can control Arduino microcontrollers.

Sunday, August 22, 2010

Advertisement to get singles to settle down and start families.

Today is a double-shot weekend. Here's my idea on a different way of positioning family life which the Government might consider.

The advertisement starts with two characters.

Toyboy is a guys with model killer looks, some sort of a Aaron Kwok figure.
FatFish is the opposite, a fat and ugly but with laughing eyes.

The first scene shows Toyboy working in the office. It shows FatFish dating FatChick.
The second scene shows Toyboy sipping on a martini and cruising in a Ferrari. It then shows FatFish proposing to FatChick.
Third scene shows Toyboy visiting the Eiffel Tower. The scene shows a quick scene with FatFish in bondage gear being pulled back into his bedroom by a chubby pair of arms.
Fourth scene shows ToyBoy playing a Playstation next to his pool in a bungalow. It also shows FatFish with FatChick pushing a pram full of babies and laughing amongst themselves.

Final scene shows ToyBoy aged to about 50 years old walking around the Orchard Road of the future. To his horror, everyone in Orchard looks like a carbon copy of FatFish or FatChick. A little kid walks by with FatFish's face photoshopped to his own. Policeman looks like FatFish, foodcourt lady looks like FatChick.

Screen blacks out.

White words appear with the MCYS logo.

"So who has won ?"

Fairness is what we strive for. But equality may turn out to be a really bad idea.

Well I think the GE fever will be upon us very soon. I just want to spend a short amount of time to talk about two concepts which tend to confuse voters and get them to support the wrong causes.

First of all, if I'm reading my fellow citizens right, Singaporeans want to be treated fairly. Singaporeans want to be hired for jobs which they are qualified for and given a days fair wages in return for a day of hard work. Fairness means that you get paid for your contribution and folks who who contribute less should get less. The mechanism to price your labor should be the free markets. It's not a perfect system, but if one works towards adding value to others, it's not going to be hard to get 3 meals a day here.

I'm personally all for fairness.

I'm a little upset at how liberals in Singapore want some more equality. Equality is a more disturbing concept. There are overtones that people will get something no matter how much contribution you make. I don't think Singaporeans want the hardworking nurse or the taxi driver to be paid equally as the poet who write poems about fornicating dead cats ( Unless this poet is a Lady Gaga like figure who attracts hordes of tourists who like seeing him fornicate dead cats at the Esplanade ).

While I want more opposition parties to gain headway I'm very disturbed that some of the more left leaning parties want more equality and the best way of doing this is by minimum wages and welfare.

Make no mistake, minimum wages will push business to create fewer jobs and if unemployment goes up, we'll lose our rock solid stability. Welfare is not going to come out from minister salaries, it will come from taxation. You either pay for welfare with a larger GST or higher income taxes.

Just want to remind readers once again to keep your eye on the government if you're not happy with them. But don't declare war on your fellow citizens. Some local people like this place because it allows them to raise decent families with low taxation.

Once again I appeal to the opposition to create a good framework for Singaporeans to draw their CPF out in difficult times rather than resort to taxation and welfare schemes. It's populist and the low road towards prosperity. It's also high time Singaporeans get to do more with that CPF-OA instead of being stuck with investing only 35%.

Monday, August 16, 2010

Article on my iPad and homemade stylus.

I took a recipe from the web and made an Ipad stylus that also works on my android phone.

Somehow a friend found it interesting enough to make a blog article out of it.

Tuesday, August 10, 2010

National Day Rant : No one is out to ruin your Singaporean Dream, lah !

I don't really feel like blogging these days. But occasionally some things occur in the blogosphere and I suddenly find that I can't really help myself.

This National Day, a lot of bloggers have taken this opportunity to talk about the Singaporean Dream and of course partake in the tradition of PAP-bashing. A lot of what the Internet has been for the last few days can be summarized by something said by a famous blogger called Kitana who wrote this classic :

" In Singapore, it is difficult to dream. Difficult to dream of anything beyond the material. I don’t wish for a future where I am stuck in my dead end job wondering what the fuck I want in my life. I don’t want a future where I die to myself, murder my idealism and my dreams of being different, simply because ‘different’ is a bad word in Singapore. "

If Kitana is reading this, I'm really sorry.

I don't buy your message.

Sure, I had my share of failures and disappointment in Singapore and I was certainly not part of the scholar-mandarin caste in Singapore. Note that I will probably also vote opposition next election too.

This is my opinion, and I welcome you to challenge them here:

a) No society is obligated to make your dreams come true.

Sure, liberals want welfare and minimum wages. That is the Singapore Dream for them. With a welfare society, a liberal can spend his days drawing pictures of the Singapore River or compose poems about his dead cat. But welfare comes with taxes and wages come from the businessmen creates the jobs. Do we want some dreams to be funded from the nightmares of other people? Too much of the gripes are disguised as attacks on the PAP but they are actually thinly disguised attacks on fellow Singaporeans. Yes, fellow Singaporeans who work hard on their jobs and enjoy low taxes or work hard to CREATE jobs for other Singaporeans.

b) No society is out there to stop the pursuit of your dreams.

While Singapore is not obligated to realize the dreams of everybody, Singapore can never stop you from pursuing your dreams. You cannot be stopped from chasing your dreams. You might be stopped from actually attaining it but that happens to the best of us.

The ultimate power of a citizen is that he can give up his citizenship and take his productivity elsewhere, that's if he refuses to vote in the next election. Singapore has to fight for global talent too. Don't like MM Lee, no problem ! Pauline Hanson will welcome you with open arms down under.

c) Materialist dreams are not spared in this society.

The truth is that my own dream is a fairly materialist one. My dream is to live on dividend pay-outs generated from my earned income. When i shared my dream with readers, all I got was 21 pages of hate-filled postings on Channel News Asia. I don't believe that materialist dreams will be spared from the wrath of the disgruntled fellow citizen. People will attack you if potentially what you are doing is interesting and will make them look stupid.

d) If disapproval from fellow Singaporeans is preventing you from dreaming your dream, you must be quite a sad person.

One of my formative years which made me like this way was at the age of 10, my ACS kid neighbors decided that my ET BMX bike which my dad got for me was not cool enough. They said it was fake and I spent a large part of my youth dodging 7mm plastic pellets from their Thunderboy handguns.
The RI kids were'nt any better, they made fun of me because I went to a neighbourhood school.

If I'm going to gripe about the years where I was a geek kid getting wedgies, developing complicated neuroses about branded secondary schools, I would miss out making friends with many ACS and RI alumni today, many have become my best friends and they can count on me if they need help.

I'm just using this story because like many of you unhappy Singaporeans, I was too poor to qualify for ACS and too dumb to qualify for RI. ( Too Ang-moh to enter Chinese High )

I worked on my academic credentials in university and now I'm going through the journey on financial independence bit. I'm confident I'll get there before I'm 40.

The fundamentals of success does not vary from society to society. It certainly would not vary whether RP or PAP is in power.

Work your butt out, strive to be likeable and don't take things for granted. Look after your family and everything will take care of itself.

As a bonus, you'll earn the respect of your most vicious critics.

That is my Singapore Dream.

Sunday, August 01, 2010

ipad is overrated?

Well I just got my iPad and am writing my blog using the device. While the device scores on ease of use and user friendliness, I am personally not sure if it's all that useful for Singaporean users. You can't really get kindle books with it unlike my google phone and iBooks will not sell you any books as well.

This just illuminates a point that we need to protect ourselves from marketing hype.

I'll look forward to an android tablet later this year. Hope that my investment returns will let me get one then.

Tuesday, June 29, 2010

Liberal Arts #2 : What can we learn from the Mohists ?

I've not been updating this blog lately. My focus is now in Android programming and coming up with a program to make my D&D games smoother. It's been about 10 years since I wrote programs seriously and now I have to relearn Java on a mobile platform.

Well today's is not so much an article but some advertising for a friend's online publication called "Singularity" which is an inter-disciplinary magazine.

I did an article on Mohist philosophy which reviews their key disagreement with the more familiar Confucianist philosophy and glean useful insights in living the modern life. I want to explore new ways of monetizing income and volunteering an article for my friends online magazine is a good way to learn a little about publication. This platform, if managed well, has some potential.

Anyway, if you are into Eastern philosophy or modern self-help, you will find that the article useful. The cost is minimal as my friend will need to pay his bills as well.

Link to the Polymath Programmer

Tuesday, May 25, 2010

Fruits from the Liberal Arts #1 - Alexis De Tocqueville on Singapore ?

Here's a short snippet on how my journey towards equipping myself with some skills of a Liberal Arts are bearing some fruits.

Alexis De Tocqueville was a French politician with a liberal outlook in life. He wrote a book after visiting America called "Democracy in America". Some statements he made can be easily reapplied to the local context:

a) Citizens displayed great melancholy in the bosom of abundance.
b) The is disgust of life in the midst of an easy and tranquil existence.
c) Tocqueville's thesis is that at the centre of democracy and freedom lies great ennui.
d) Freedom allows citizens to adopt a single minded pursuit for material goods.
e) Men who live in democratic times have multiple passions, but most of their passions end in the love of wealth.

Now I read only a summary of his books but this has certainly ignited an interested to read the entire book just to see if Alexis has predicted our Singaporean way of life over a century before Singapore gained independence.

Another possible use of Alexis' works is to give us a glimpse of how China's growth will change their people and outlook in life, there is already talk of China being like the US a 100 years ago.

I won't really be dismissing the liberal arts now that I've discovered this gem.

Sunday, May 23, 2010

My views on how Singapore can adopt the Liberal Arts.

My journeys in wealth creation has stretched most of the technical disciplines. In Singapore, that's what most of us are built to do. Work hard, get a degree and then get employed rapidly to start building wealth for the future. The economy of the future almost ensure that an engineering education will but be enough to sustain a career beyond a decade.

Moving into a management role will require a person to be more aware of the subtleties of corporate life, which means that the advantage will shift towards a manager who is more human and can solve problems with very little structure and live with truckloads of ambiguity.

It is this realization that I disagree with the government's approach towards the liberal arts. Right now, the trend is towards training law and medical students in the liberal arts where they remain elite and give them this opportunity to delay graduation by a year to become more well rounded human beings. All this does is make the program more expensive and delay the money making years by a year for the smartest guys in our education system.

I think this approach will fail. Debt ridden students are more likely to game the grades system to maximize their starting incomes. Humanity can always come later.

Furthermore, the industries in the future will still be run by us Generation X's. We're a ruthless and unforgiving generation who has been trained to be very unsentimental in work matters. The burden will be upon the debt-ridden Generation Y and the Millenials to wrestle the thought leadership from the Generation X's - it would not be ceded more easily.

So i think that a liberal arts education will widen the generation gap between Singaporeans.

I believe that way forward for a liberal arts college should be the opposite of what the West has intended for their people.

The Liberal arts should become an alternative to the EMBA, to allow executives who have reached a level of comfort with themselves to learn more about their past and humanize themselves into better managers. The liberal arts multiple and amplify the years of wisdom already gained by engaging in the workforce. It will also open the minds of the folks in the economy who need it the most.

It will also make execution much easier, mid-level executives can afford to pay for the low lecturer-to-student ratios and discussions between working peers can also attain a level of gravitas as yet unattainable from a bunch of young adults. I bet the academics want a more mature discussion too with cases drawn directly from the working world.

I hope that the Universities will consider making the liberal arts a postgraduate qualification, where senior managers will come back to school to re-school themselves in grammar, logic and public speaking.

Because if you look at the quality of Singapore management today, we're in a dire need for self-improvement.

Monday, May 17, 2010

Presentation at BlinkBl_nk - The Philosophy of Finance.

With the ever pragmatic Government of Singapore looking at the establishment of a liberal arts college here. Folks like me who had a very "functional" education will need to re-look at ourselves and ask ourselves if our skills will be outdated when the next batch of graduates, many armed with a very deep understanding of context and critical thinking, arrive in the workplace.

The value of the humanities is immense and even the most hardcore engineer or investor can benefit from a very simple grounding in the Trivium - Grammer, Logic and Rhetoric - the Foundation of a classical education.

My next gig will be at Blue Jaz where I will be talking about the Philosophy of Finance.

I will present a framework drawn from a famous philosopher and explain how a similar process can be used in a pragmatic setting like Personal Finance to rapidly bootstrap folks along the journey to becoming their own financial guru.

Venue : Blue Jaz Cafe
Address : 11, Bali Lane, Third Floor
Time : 19th May 2010, 7pm

Click here for details

Friday, April 02, 2010

Talent-based career choices versus knowledge-based career options.

Chin Yong who has his own blog, commented on my presentation, which can be found here:

I think it's worthwhile talking about this here as a full blog post.

My presentation in bar-camp highlighted ways in which employees can perform work at the higher end of the value chain, moving from mechanical work to service oriented face-to-face work and finally to knowledge-based work which involves manipulation of symbols to solve problems for the company they work for.

After the presentation, Chin Yong asked a really good question.

How should political work be categorized ?

Chin Yong touched on a very good point because one category of work which I did not elaborate on during my speech is talent-based work. Politicians, performers, sportsmen, artists and designers often fall into this category.

Talent-based work is hard to fit into my model of self-help because of the unpredictability of the pay-off. In talent-based work, remuneration functions in a broad pyramid-like structure where work at the entry level is paid below that of perhaps some mechanical workers. At the upper echelons of talent-based work, you could well be paid millions a day. Just imagine how much a struggling musician is paid busking in Orchard road MRT compared to the pay Lady Gaga gets after every public appearance. The difference is huge and defies common sense and explanation.

When a person has to make a decision to join talent-based industries, a prerequisite is very often passion. But almost everyone else in this industry has passion too, so the X-factor which makes all that difference is still natural talent coupled with an intense passion to pursue a calling.

Just how do we develop talent can also be a difficult problem. Authors like Malcolm Gladwell recommends 10,000 hours of deliberate practice to become a world-beater in any endeavour. Imagine getting into an industry where everyone is willing to put in that number of hours of deliberate practice in the industry as well. So you will need to ask yourself : where do you stand on the talent score-chart ?

My current personal opinion is that between knowledged-based work and talent-based work, choose knowledge based work because it's at least a more predictable way towards financial independence. You could be wrong about your personal talents and you may even underestimate the personal sacrifices needed to become someone, like, Rain, who has a fairly sad personal history.

But publicly, it's not very practical for a finance author to tell people to shelve their dreams of becoming a mover and shaker in the world of the Arts or becoming an International King of Pop.

There will always be one Lady Gaga to give aspiring stars some hope and prove finance authors wrong.

Anyway, this is where my thinking has been stuck at. There is still a lot of conventional wisdom when parents tell their kids to study hard, get a professional degree first to get that backup plan in place before pursuing a high risk career move like that in the Arts.

But do share with me if you have a better alternative.

Sunday, March 28, 2010

Barcamp 2010 - A Hacker's Guide to Financial Independence

Barcamp occurs twice a year to allow hackers, geeks and assorted hobbyists to come together to share ideas with each other. This year hundreds of people came together at Singapore Polytechnic to talk about tech start-ups, cooking, light sabers and programming.

I was very privileged to be able to share the gist of my financial ideas with this crowd.

The video of the presentation I made prior to my 30 minutes presentation can be found here. Unfortunately, this requires Veoh which means that a special client may be required to view the entire presentation.

Watch A Hacker's Guide to Financial Independence in Educational & How-To  |  View More Free Videos Online at

Expect a subtle shift as I attempt to incorporate lectures and presentations in this blog.

Friday, March 19, 2010

Blog updates will slow.

All fans,

Thanks to all your support. Updates to this blog will slow down due to the upcoming preparations for Bar Camp and my efforts to monetize my gaming hobby.

Expect updates to this blog to slow down from now on until I can figure out a better way to make online income.


Thursday, March 18, 2010

Cognitive surplus as an asset class.

I've just learnt of a new term this week - the cognitive surplus.

Your cognitive surplus is the amount of mental energy you have remaining after going through your workday. With the Internet allowing new business models to be created in seconds in the form of blogs, mobile applications or websites, its no wonder that at a global level, this is an asset that cannot really be ignored.

While the self-help gurus are trying to make sense of cognitive surplus as an idea, I'm going to step forward to say that the cognitive surplus is something which needs to be invested just like an asset class. In fact, your cognitive surplus should be part of your human capital and managing it well can mean more financial capital to fund your retirement or travel ambitions in the future.

The reality of cognitive surplus immediately kicks in after you are willing to consider it as yet another form of investment.

In this reality where a business can be built in minutes and torn down in seconds, saturation of the Internet as a media makes it very hard to generate a positive ROI within any reasonable time-frame.

In my personal case, selling my time for money at work seems efficient enough. Investing my wealth for dividends has also been relatively frutiful. But an honest examination of how I am using my cognitive surplus reveals that there are many areas of improvement. In fact, I can safely say that I'm losing money and time from my cognitive surplus ( maybe there really is such a thing as a cognitive deficit. )

Only one out of three of my books has broken even. My on-line boutique does not really sell due to high prices and my e-book has only allowed me to get back my capital. Like any business, employing your cognitive surplus requires capital and you will need to husband the steady flow of income into something which is repeatable, it's like turning your ideas and brain juice into an annuity-like financial product.

As I have yet to get my formula right, I can only guess what's the next step for me :

a) To leverage on cognitive surplus, first seek a platform where you can easily reach your niche market. My RPG books sell in

b) Use a small project with little time and money and then seek to break even to push yourself up the learning curve.

c) Using sales figures as feedback, employ deliberate practice to adjust price points and optimize expenses accordingly.

d) Seek secondary benefits, like skills you learn can be applied to your day jobs or refine the way your invest your financial capital.

e) For me at least, the cognitive surplus simulates a deeply out of money call option. Until you can find a niche or a consistent set of customers, you are more likely to never get into the money. As many options expire worthless, many out of office efforts only lose time and money.

Right now, I consider myself lucky. As it turns out, my day job and investment income funds my dreams of a being a writer. I could also be finding other ways to squander my cognitive surplus like spend my time watching TV or playing computer games.

But it's humbling to know that there is a long way to go before my cognitive surplus can be converted into an annuity payment.

I hope someone with better luck out there can share some ideas with me on managing this new 'alternative investment'.

Sunday, March 14, 2010

If women are not choosy, men will have no standards.

I was privileged enough to read this article from another blogger in Singapore.

Rachel Zeng's Tirade

Personally, Rachel is a idealist who wants the world to conform to her liberal conscience. There is a better way to get the message across to Singaporean men if she has issues with them. Coming up with an essay to shove egalitarian down Singapore's throats will only result in being ignored.

Get this :

A) We Singaporeans do not want equality.
B) Every election result is a proof of this reality.
C) Meritocracy is not equality.
D) Some people do get a lot more than others. And their kids get even more than that.

If I were Rachel, I would approach the problem in a different way.

When men accuse women of being materialistic. The proper answer from feminists should be,"Well, so what's YOUR problem, not man enough to meet our standards izzit ?"

Many of us privileged Singaporeans who live carefree lives to the point of being able to blog about it know that we exist because our mums married correctly.

Our mums chose our dads who then proceeded to raise us, send us to school and give us enough support and advice to have great careers. In short, our mums had GREAT TASTE, that's why we are getting along in Singapore !

A human female, unlike a human male, invests a lot more in parenting than a human male. As such, evolution has armed women with a nose of sniffing what's best for kids. Tall, athletic men with symmetrical features signal healthy children in the future. Wealth signals availability of resources. Women are so-called materialistic because Mother Nature ( being a woman ) intended it.

This comes back to my biggest contribution to resolve the plight of the Single man of Singapore.
The magic figure is an income of about $4,500 a month. This puts you somewhere along top 30th percentile in earnings that will make you acceptable to the average female graduate who forms the biggest pool of single women in Singapore.

Work hard, get this resolved first, then focus on other areas like your dress sense, sense of chivalry, vocabulary, etc. Failing which, take your income to country where people make dramatically less. Statistics are beginning to show that Singaporean men are approaching this golden era of being God's greatest gift to Asia. Our GDP per capita is solid and we're growing 6.5% this year.

I have advice for women:

a) Don't wait too long.

I sound like the PAP now but us guys will accumulate our wealth and in time, we will become great catches in SE Asia or North Asia. Singapore men are appreciating assets like growth equity. Singapore women need to keep yourselves looking good. If Singaporean are going to accept that Singaporean women are realistic, then get real about about what we Singaporean men really WANT from a relationship.

b) Turn men down decisively, be cruel if necessary.

It's very painful to listen to stories of rejection from my single friends because it's such a long drawn out affair that destroys morale.

We men recover from rejection fast and we're good at moving on.

After all, we were rejected from top secondary schools, the gifted program, OCS and some local universities. Don't say,"I not free this Friday but next week maybe but my dog got birthday. " That's weak and you're wasting our time.

Say something like this,"You do not fit into my image of what a husband should be like." or " I don't think my family will be proud of me if I bring you home." Over the long term, we will appreciate this.

c) And look after your own finances.

I tell my wife this since I started dating her.

I wanted her to have her own financial resources because infatuation does not last long - 2 years at most. Enduring love in a marriage is more like respect and companionship but women need to account for straying men. When men hit mid-life crisis, they will do all sorts of things to prove their virility so women should maintain a piggy bank of their own.

Wednesday, March 10, 2010

Adventures in Monetization via e-publishing.

For months, my personal time was spent thinking of ways to generate Internet cash flow. I refused to employ methods espoused by Internet marketers and wanted to see how far I can go using only open sourced tools and some free websites.

Employing only Open Office Writer was quite a challenge as I realized that there is a need to relearn all the user interface features of new software. When it got to desktop publishing, I used Scribus, a free product which had difficulties importing from Writer tables I spent days churning out. The open sourced world gets your done eventually but the learning curve is much higher and it encourage a sort of "work-around" mentality which is crucial in the IT industry these days when things are very dynamic everyday.

Anyway, my e-book broke even within 2 weeks of being on sale on a specialist online RPG store. It's not a lot of money, about $20 US dollars which confirms that my short project was a success. Perhaps within this year I will redeploy my templates to build a few more products to generate more cash flow so see if I can generate a steady stream of $50 a month.

There are some lessons I learn here :

a) On-line businesses are hard to start. Until you can confidently generate income, use only your personal time to so stuff.

b) There are sites which sell generic e-books, odds are that you won't sell anything. A website that caters to your audience will have a smaller traffic but will have more people who will take a liking to your book.

c) Blogging to preview or advertise your product can help greatly.

So far I think the jury is still out on Internet Marketing. I do know that, for most ordinary people, creating on-line products and selling them is an inferior strategy of generating passive income. Far better to get decent work with your qualifications and then aggressively invest them in income generating real estate and equities.

But I going to keep on trying to prove that I am wrong in this regard. I can take my time because i still have a day job.

The result of my game product can be found here :

Noble : A Martial Controller for the 4e D&D game

A blog which promotes my Dungeons and Dragons 4e product is found here :

Noble Design Blog

Saturday, March 06, 2010

Some solutions to population growth and foreign workers.

Today I will present a solution for population growth and foreign workers.

Population Growth

Population growth can stimulated by asking ourselves firstly, how much GDP will we allocate into having future generations of Singaporeans. Russians, apparently, are willing to allocate 1% of to stimulate population growth. Whether this 1% comes from education or defense, it does'nt matter, figure this number out and stick with it for the next 10 years.

When a Singapore couple have a baby, the mother gets up to 6 months no-pay leave. They need to raise the kid for a year on their own, but one year later, the parents can receive a bonus equal to the pool divided by the number of new babies made last year. This is a one-shot, bullet payment into their bank accounts. At 1% GDP, this number should be quite significant.

This will incentivise Chinese couples to have kids in inauspicious years, prevent overcrowding of resources and eliminate discrimination against working mothers.

Foreign workers

Yes, foreign workers keep many Singaporeans poor by lowering costs but they also contribute to the dynamism of the Singapore economy. When the government raise the levies, they get hammered and lose votes.

Let's look at Low Thia Khiang's solution of the dependency ratio and then add a price setting mechanism to push the onus of cost setting to employers. This is much like the COE mechanism but now its applied to foreign workers.

Governments should only decide how many foreign worker permits Singapore can accept based on the tolerance of the citizens. Every year, HR companies will bid for foreign worker permits. They will set a number of licenses and how much they are willing to pay. Bidding is done in one pool and banks bid in the same category as the construction sector. Minimum bid per head is a low $100.

Price discovery of the value of the foreign worker is based on the bids of the employer. They decide how much they are willing to pay for foreign workers, after which they will pay in one lump sum of the bid.

The government will stop screening foreign workers and instead screen for criminal records and diseases. Employers will bid for licenses and then hire from abroad, approval will be streamlined and determined by whether employers have the permit or not.

Proceeds from the bids will determine how much governments should pay for productivity improvements.

By the same token, rather than spend money paying civil servants to screen foreign workers, allow them to pay for PR status. Allow about 10k to 15k of foreign workers who have spent at least 2 years in Singapore to take up PR status by bidding for this. When they succeed, their employer will no longer need to have a permit to hire them so they can get higher pay. This may even force competitive bidding to become more than $50,000 per PR status.

For citizen conversion, allow PRs of at least 2 years to bid for citizenship. Have a low number 1,000 citizenship licenses for bidding. This number can even hit $200,000 in a bullish economy.

Share proceeds with existing Singaporeans with income tax offsets or CPF credits.


Wednesday, March 03, 2010

Carebears and a discussion on personal strengths that are useful in investments

The Carebears are an accidental creation which is something that is worthy of mention. I have some sort of mastermind group which is composed of close friends who are generally into self-improvement, financial mastery, abstract mathematics, sociology, Goatse, philosophy and other high-falutin ideas which many Singaporeans will disapprove of if they join us for a beer session in Ang Mo Kio or tea session in Tea Chapter.

The name arose from our accidental run-in with a group of competitive board-gamers who only meet when the World of Warcraft servers are down on a Tuesday. They call their meet-ups "Tuesdays with Assholes". I called for a dinner session last night calling it "Tuesdays with Carebears", carebears being a term for folks who play games for non-competitive, social or affiliative reasons, and the name somehow managed to gain traction within the group. Just hours ago, the gang started taking personality tests to figure out which carebear they most resemble them. And we're talking adult STRAIGHT men here.

So here's a toast to the power of ideas.

Ok, let's talk about personality tests.

I first learned of the Strength-finder 2.0 through Singapore's top blogger Mr.Wang. He took the test and recommended it for his readers. Being a Mr. Wang fan, I promptly bought the test and took it for myself.

My Gallup strengths are :

Analytical, Input, Intellection, Competitive and Activator.

I think these strengths lend very well into investing:

a) My Analytical inclinations forces me to see numbers before committing my money and I'm always looking for clear picture of cash flow before investing in a dividend stock.

b) Input as a strength makes it easy to read all the investment journals, take the CFA exams and absorb large amounts of boring statistical data.

c) Intellection is a strength that allows me to create internal dialogues to challenge my own investment beliefs, it also predisposes me to philosophy which introduces ideas like that of Karl Popper who taught me to come up with ways to falsify my own investment ideas actively to refine my portfolio.

d) My two other strengths of Competition and Activator gives me the motivation to become financially independent by benchmarking my status with my peers and pushes me to make snap decisions with a sense of urgency.

Over the many months I've known my fellow Carebears, I've noticed that there is a common thread in that almost all of them feel a compelling need to know more about themselves. It could be because they want to delve into the meaning of Life or wish to make a decision on whether they are in the right career path. As an amateur life-coach, I have always directed them towards using the Strengthfinder 2.0 to frame their decision based on what their Strengths are.

Right now, it's still to early to see results but I'm keeping my fingers crossed that when a person is still going through some introspection, it may be useful to look into their personal strengths and withhold judgment until they can learn more about themselves.

They may well find a trump card in their hand which can make a difference in their journey in this world.

Saturday, February 27, 2010

Singlehood versus marrying a foreigner. Which is the bigger threat if you are single and looking for someone ?

According to a survey done in 2000, only 5% of Singapore singles want to remain single eventually. Although the faith in marriage as an institution has eroded, many singles are still interested in settling down. This article tries to arm singles with what to look out for when choosing a mate.

A discussion with a friend yielded some insight into what a single Singaporean should be looking out for.

Let's start out with a few assumptions:

a) If there are more singles than people who marry foreigners, singles are choosing single-hood because it is a better choice than marrying a foreigner. Pro-marriage singles need to compete with the concept of single-hood to find a spouse.

b) If there are more people who marry foreigners than singles, then marrying a foreigner is a better choice. Pro-marriage singles need to compete with foreigners to find a spouse.

The original discussion was focused only on Singaporean men marrying Vietnamese foreign talent, obviously that number is small so I've constructed a more interesting question that can yield itself to statistical measurement.

According to statistics which you can look for in the web, we can say with confidence that less than 20% of the Singapore population will be single once they reach 45 years old. ( According to census in 2000, number of singles in is about 15.5% for men and about 14% for women. )

Now, let's look at marriage trends. Based on recent marriage trends, only 52.5% of marriages registers in ROM are Singaporeans who marry other Singaporeans, deducting the number of marriages of foreigners with foreigners registered in ROM, about 40% of Singaporeans marry a foreigner these days.

So let's come up with an approximation of numbers to answer the question :

20% of Singaporeans prefer and thus, stick with single-hood. The rest are married.
Given recent trends, 40% of marriages are local-foreigners. 60% of marriages are local-local.

The final breakdown is as follows :

20% single, 48% married to a local, 32% married to a foreigner.

So clearly, the argument that a Singaporean will need to compete to single-hood versus foreign talent is not as convincing as the argument that Singaporeans will turn to foreigners if they cannot find a local spouse. This argument remains even stronger for Singaporean men as more Singaporean men are married to foreigners in 2008 than Singaporean women.

What insight can you possibly wean from this conclusion ?

a) If you are looking for a spouse, you need to be better than a foreigner. For men, it may be accumulated wealth and facial symmetry. For women, it will likely be based on waist to hip ratio and other predictors of sexual attractiveness.

b) If you simply cannot find a local spouse, it is possible to find a foreign spouse. This occurs often enough in Singapore to be a major lifestyle option.

c) But if you can't even find a foreign spouse, you will need to consider the possibly that you are not doing enough self-improvement to defeat singlehood which is currently the "weaker opponent". The solution is continuous self-improvement to become a better person for marriage.

I think this analysis is not complete. it would be interesting to break the figure down for Singaporean men versus Singaporean women. Most marriages with foreigners are committed by Singapore men. There is still a possibility that Singaporean women rather be single than marry a foreigner.


Wednesday, February 24, 2010

Switch and changing spending habits.

One of the best things about the Internet is that now its possible to buy e-books the moment they are freshly available at Amazon. Using some tech savvy, I was able to read Switch by Chip and Dan Heath before it even arrives in local bookshops ( and at a ridiculously low $15 SGD ).

Switch is an immensely useful book, an equal to the authors' previous bestseller Made to Stick. It has a chockful of advice on implementing changes in behavior and in organizations.

Here are some ideas ported over to personal finance in the local context.

a) Saving money is a rational decision but somehow the saver must absolutely have an emotional need to want to save money. For me, I recast the meaning of money as personal freedom and see financial independence as an act of defiance against shoddy Singaporean management and the authoritarian regime that wants Singaporeans chained to their home payments.

b) Savings require an infrastructure or system to make it happen. I have recommended a separate DBS savings plus account to sock away money the moment payday arrives to create a savings commitment immediately even before a single cent can be spent.

c) You will need to hang out with frugal friends so that peer pressure will prevent you from putting your money aside for a rainy day.

d) You need to formulate simple concrete rules to reduce your expenses such as "take taxis only after 12 midnight." or "buy soupy lunches with liquid content to save on buying softdrinks"

e) Breaking down payday into weekly paychecks and insisting on a weekly budget may be easier than working on a monthly budget.

f) Find out what a frugal and happy person does and emulate his/her success.

Anyway, you'll probably find better ideas from Switch as its principles can be universally applied to any domain.

Saturday, February 20, 2010

The CCA vacation and my fashion line.

I've been busy launching my role-playing game product on for the past few months and one of the things I was thinking about when I completed the project is to take a break from all my CCAs. As many readers can see, I've been busy after office hours since the day I started work. I spent my first five years studying my IT and finance certifications and spent the following five years writing books on finance.

For a change I wanted to free my mind from the burden of always being focused on doing something. The aim is to release all the pent up creative energies which has been a powerful blessing and curse for me in this lifetime.

It's been one week since I started on my CCA holiday and I have FAILED dismally !

After completing my e-book and started a new blog on ENWORLD to market my stuff, that Engineering Muse of mine struck again, this time inspiring me to start my own fashion line.

Let me introduce to all of you to my Prosperity Gear designed my yours truly !

a) Innocent T-shirt with a Vietnamese theme.

My first creation started as a joke when I was hanging out with my friends. All of a sudden, some dude blurted out " My my, you have a yen for strong dong !". That statement is dying to be monetised. My first creation is a T-Shirt which is innocent unless you hang out with a group of forex traders or finance folks. This is guaranteed to make you a life of the party when you for a dinner organized by the CFA Institute.

b) Lovey-dovey T-shirt.

My next creation is something I'd like to do for people who want to succeed and find love at the same time. In a singles gathering, sometimes its hard to advertise that you are money savvy unless you can somehow print your salary on your clothes. This T-Shirt explains that a good spouse is like equity, best to buy and hold. Financially savvy people make the best spouses. This is certainly a sensitive way to advertise your personal strengths.

c) Hetty Green shopping bag.

My final creation showcases the fact that the financially savvy have a great capability for irony. What is an ugly old lady doing on a shopping bag ? Hetty Green is the Legendary Miser of Wall Street who was so stingy she hesitated to pay her son's medical expenses and caused him to have a leg amputated in the process. No other shopping bag is created to remind the shopper to be frugal at all times than to channel the legendary frugality of Hetty Green.

Sunday, February 07, 2010

Three week break from blogging.

To all fans,

Right now I'm about to complete my e-book for my role-playing hobby so I need to focus on this project exclusively over the new year.

If you are, in fact, a D&D 4E player and you are interested in what I'm trying to do, pop me an email and I can even send you some play-test materials.

On the markets, so far there is'nt any change in my portfolio. Looks like my decision to have an investment moratorium until May seems to be the right thing to do so far. Here's hoping that some bargain hunting can take place then.

See you guys in March !


Thursday, February 04, 2010

On Art, Art investing and the worst book I read in ages !

If Seth Godin were right, this is how you write best-selling non-fiction.

First, try to understand and define the zeitgeist of the times. Channel the anger of the audience to motivate them to listen to you. Seth successfully does this and taps into the anger of Americans on outsourced jobs and the mismatch between what higher education promised versus what it actually delivered.

Second, prepare a set of qualities that would be universally and helpful in one's working career. Stuff like having talent, being engaged and going the extra mile for the customer.

Third, create a new lexicon for the reader and keep hitting them until it sinks in. Everything that is good, productive and useful is redefined as Art. Following a process is not art. People who follow process are bound to lose their jobs to India. Only someone who turns his work into a form of art can then join the hallowed ranks of the Linchpins - those who add so much value that they can't be fired from their jobs.

Finally, keep the empirical support of your ideas to a minimum but occasionally pepper your chapters with street-wise advice, nothing substantial because otherwise, someone may come around to falsify it.

The last time I checked, Linch Pin racked up 5 stars from amazon from 120+ reviews. It was a good score. Better than my personal favourites authors Daniel Pink and Tim Ferriss.

This is one book I love to hate. The insight and some actionable ideas are kept to a minimum, instead Seth spends a lot of time telling the readers how much he understands them. One way by appealing to the lowest common denominator if you are Ivy league educated is to keep telling these guys how the education system has failed them. I doubt the system failed Seth. He correctly identified that schools have only two purposes :

a) Teach people to solve interesting problems.
b) Teach people to Lead.

Someone this smart should know that schools are there to socialise people into productive citizens, most folks go to school to prepare for the industry. To make that happen a lot of tradeoffs are made, some rote learning will have to take place and some people will have to take a cut in self-esteem.

Another angle which Seth has taken which irks me is that it patronises right-brained people. I think all societies these days deal creative types a fairly cruel hand. Hence traits which are traditional strengths like analytical skills and the ability to grasp language is carefully packaged as Art to appeal to these people. This, I suppose, gives the open-minded non-conscientious types hope that things can get better. ( We know that statistically if you are not conscientious, things tend to get worse. Being open-minded just makes your destruction occur must faster. )

One of my cards I play when people rail against a technological savvy and analytically centered world is that statistical tools have even cast light on the fine arts. In Skate's book on Art Investment, the best artworks tend to occur when an artist is in his 30s-40s, the most expensive art tend to be landscape followed by abstract followed by female nudes. No one gives a damn about male nudes, BTW.

In this illuminating book, two key factors determine the value of a piece of art. Provenance is discount rate that is determined by probability that the art is fake, has export restrictions or may be stolen good. The other factor is simply an irrational factor, yes, is there a greater fool who is willing to pay for this piece of art.

To most people, labelling the best skills in the corporate world Art gives them warm fuzzy feeling of being treated as a human being and not just like a cog in the machine. i wish them all the best.

After all, would'nt engineers be simply poets with better employment opportunities?
If we can accept that, then Poets are engineers who can't count.

Wednesday, February 03, 2010

More on high-frequency trading and building a personal hedge fund.

My search to understand more about high-frequency trading has led me to the following book, which has garnered quite a lot of good press.

I figure that even if I do not learn very much on writing programs on arbitrage, I should be able to pick up some domain knowledge which can be useful at work.

Tuesday, February 02, 2010

My first smart phone : Google Nexus One

I gave my old Nokia a Viking funeral last month as it had accompanied me in my journeys through three companies and survived countless of IT escalations. It was a very good run with my Nokia except that, by now, the buttons of the Konia has started failing and I really needed to punch the buttons hard to get an SMS out.

Not knowing very much about smart phones, the primary reason that I chose a Google Nexus One is that it's not an Apple iPhone. The second reason is that I liked the open Android development platform and the way it encourages continuous innovation and open competition between phone manufacturers.

I would'nt want to brag about the specifications of my phone but I just to highlight some of the uses I have put my phone towards.

Here is a snap-shot of my Nexus phone side by side with my other favourite toy, the iRex Technologies DR1000S e-reader.

The two pieces of gear demonstrates one of the current applications of the gadgets which I have which is to play a Dungeons & Dragon game without pen, paper and dice. My e-reader displays a PDF print-out of my character sheet of a 5th level Kalashtar Bard. The Nexus one ran an application called DicePro which allows to roll any of the polyhedral dice that's required by the game. So far, the experience has been fun as I have lightened my load for a game tremendously.

Other applications of my Google phone has been as follows :

a) I use Evernote to capture my ideas while I am travelling and ensure that these ideas get logged. This is crucial for non-fiction writers as an insight can strike me anytime and anywhere.

b) A new skill can be picked up via audio-books on my device to ensure that if I can't get a seat, I am always learning something new.

c) My compulsion to monitor my portfolio ( despite it's low turnover ) on the go is met with 3G and Yahoo finance.

d) I scan the barcode of books in MPH and Borders and determine the prices the books would sell on Amazon then decide to place my orders later when I get home or buy on the spot. Too bad I can't do this for household products.

e) Keep updated on my friends. Just sent out a request to look for a CRM solutions provider to my network of friends on Facebook.

f) Hopefully, when my wife is free to tape me on Qik, I will be uploading some lectures on my ideas on financial planning.

In summary, I'm not sure if I actually own a phone anymore these days. It's a powerful information machine which can sate my voracious appetite for more information whether its information on my portfolio or who some of my lady friends are dating.

Saturday, January 30, 2010

Will the Reform Party make your blue furry fantasies come true ? A look at proposed improvements to education in Singapore.

In the movie Avatar, the Na'vi were only able to fend off the colonial humans because humans found way to break ranks with their own kind and joined the Na'vi in battle. This fulfills the fantasy of the white man who joins the savages in upholding their rights in the Universe.

I think this tale has great parallels in the political situation in Singapore.

One of the best news this week is that the Reform Party has managed to bag two government scholars into their ranks. Almost everyone on the Internet has applauded the move by these two potential heavyweights. The Reform party is, as such, on the right track. By and large, Singapore is still very status conscious and we'd very much like to see people with a strong academic and career track records in politics.

Well this post will critique the proposals by the Reform party on education. I'm doing this because I do not want to be caught up with all that mutual back-patting that goes on when opposition parties make some headway. Opposition parties need folks like us to critique their ideas because, well, better us than a rival politician in the Singapore government.

Here are issues on what the Reform Party has proposed so far.

a) Lowering defense investments and raising investments in education.

I applaud the Reform party for taking such a stand because this is about the first time I'm seeing opposition politicians actually proposing where some of their proposed investments are coming from. However, many Singaporeans will not support lowering our defense expenditure. Our neighbors has recently torched 10 churches and we will need to maintain our determination to put a large amount of our money to keep our lives and investments safe. The high proportion of investments into defense maintains our status as attractive places to invest money.

In fact, if it were up to me I'd increase defense expenditure to leverage on new technologies so that NS liability can be reduced by another 6 months, freeing men to join the workforce earlier.

b) Getting rid of the PSLE to prevent streaming at secondary schools.

I strongly disagree with this policy. This is one of those populist ideas which people will buy but may actually reduce social mobility even more. Without regular exams to channel people into the schools which suit their pace of learning, rich people who manipulate students to join top primary schools like Henry Park would be able to extend that ridiculous advantage even further creating micro-communities of their own in their elite neighborhoods. Students will also experience more stress when they finally reach O levels after 10 years of gentle schooling.

There are better ways to eliminate the social stigma of being sent to EM3 or Normal stream. Simply segregate subjects to Special, Express and Normal tiers. A numerate pupil can take Maths and Science at Special level, Languages at express level and maybe social studies at Normal tiers. University entrance will be credit based and students have a fixed time to earn their way to University or enroll in an industrial apprenticeship school.

All that whining about selfish students can be met with project work where joint scoring will determine the score of the team.

c) Comment on "practical" courses by James Gomez is confusing and pointless.

I'm going to leave my most scathing criticism to what James Gomez said when he gave his speech on education. James Gomez wanted more theory and debate to complement practical lessons in institutions of higher learning. First of all, James has to show what theories and debates are lacking in a curriculum and which faculty is the culprit for this criticism. Secondly, students who incur debt will always opt for a practical education so that they will be able to gain employment when they leave.

Will Accenture's HR department be impressed with my deep philosophical musings on Jane Austen ?

As an engineer who did public speaking and gate crashed many union general meetings, I don't think there is a lack of debate. Personally, students should drink less booze and go to fewer discos and focus on their grades so that they will have more time to get involved in CCAs in campus. CCAs simulate the politics, backstabbing and debates of the real world.

With my experience in our universities, I think there are cheaper ways to help graduates. Simply have better outplacement services in campus which is sorely lacking in NUS. Come up with system to attract HR departments by giving Singaporeans the first choice to talk to the top MNCs, have small tax subsidies for MNCs that grant internships and hire Singaporeans on a per head basis.

Seriously, what is James Gomez trying to do ? Is he trying to permanently stamp his own liberal conscience in our local universities ?

Anyway, I would like to end by talking about self-esteem. I think political parties are always thinking of ways to invest or legislate our way into giving voters more self-esteem because it's a great way to gain power in this world that we're in.

I'm not a big fan of Socialist Egalitarian European or Liberal American self-esteem. Our teachers cannot be transformed into an Adam Khoo or Anthony Robbins so that our children can feel good about themselves, they have real content to impart to Singaporeans of tomorrow, its a job for professionals. Our competitors are getting more and more vicious by the day.

By and large the silent majority of Singaporean want to be winners. That's the reason the PAP has been around for decades.

Make that the same reason to give Reform party a victory on the next elections and you'll be on the right path.

Friday, January 29, 2010

Moratorium on investing my money for about 5 months

For the past 3 years, I have been investing almost my entire salary packet into the stock market. The aim of doing that then was to ensure that I was able to make my investments when the market was at its worse as statistically markets outperform just after a terrible year. The second idea was that recessions don't last and markets can seldom sustain a downturn for 3 years.

This idea paid off rather well in 2009. At this stage, even though I have predicted another fantastic year with STI reaching 3400, the case for a V shaped recovery in Singapore is no longer as rosy as a month ago.

One idea which was off my radar was how the government may react to the people's anger over immigration as a key issue during the next elections. To appease the voters, the government may make adjustments which may hurt small businesses and HDB speculators and this may increase costs over the short term in the form of inflation for citizens and higher operating expenses for businesses. There is also a subtle shift of news to focus on future not so much about GDP growth but about being productivity growth.

On the whole, these adjustments will be negative for Singapore businesses even though i would expect most readers to welcome these changes. the higher cost of hiring a Singapore will eventually trickle down to the consumer. If we adopt Japan practices and try to model them, we will end up paying japanese prices for goods and services.

While such news will hardly impact the defensive yield investor, my mandate this year is to accumulate about my annual income worth of blue-chip equities, so it may be prudent to sit out the market and miss the upturn bought in by the Chinese New Year and just lay low for about 6 month.

The money will sit in a fixed deposit for now and I will come back when investors try to heed the cliche "Sell in May and go away".

Wednesday, January 27, 2010

What Apple's new tablet would mean for writers.

What do you get if you add this :

To this ?

In a moment's time, Apple will probably unveil their next big thing, some sort of tablet PC device. While tablet's are really nothing new and neither would their OS be anything special, I strongly believe that Apple's entrance into the tablet computing will severely change the game for writers and authors in Singapore.

Here is what i think will happen:

Apple will work with several publishers to publish content which is likely to be some sort of an iTunes-like portal for books. What would be new is that, unlike the Kindle, the tablet is a generic device which can also play videos and render books in full color using what is commonly called the ePUB format.

( Acrobat 9 already allows people to author multimedia files of this nature. )

This creates the possibility of new kind of media which will become a new book. Imagine a PDF file which can be distributed as text with some pictures, but with an Internet connection, some publisher will be able to stream music/video or to animate graphs and allow you to attend lectures at the same time. Videos, music and graphical animation then, become the new embedded objects within what was known previously as a book.

This is the killer app of 2010.

This has the potential to resolve piracy issues arising from the copying of books. Suppose we distribute these media files with the text for free but paid subscribers can asssess videos from a page, we will only need to secure the videos and the multimedia to ensure that only customers who pay can get the full amount. While books remain static, videos centrally secured can be always kept up to date. Pirated copies of books with text will only end up being some kind of advertising for the full product which will be rich media that keeps up with the times.

This has serious implications for the publisher of textbooks.

This is a radical shift of power once again to publishing houses because authors in the past can distribute e-books directly to the customer and have higher margins by cutting away the distributors and printers, Now publishers can leverage on their size to get authors to embed lectures and sound into multimedia pages. The richer the media, the higher the barriers to entry to be a writer.

As an author, we will have to take Apple's tablet device seriously, because if we wish to recapture the margins from our information products, we will have to develop skills beyond writing. This means using software like Qik to take a video of us giving our speeches, learning how to create graphs which move and slide (anyone tried learning the Mundell-Fleming model without animation can confirm how hard this endeavour is).

As I embarked on my third book, I remembered that I had to pick up cover design, desktop publishing in addition to word processing. In the future, I see myself doing public speaking all over again to win over a generation of new readers and have to pick up the skills of an animator to boot. If I outsource the work to someone else, I may create a media product which is priced too higher for the discerning reader.

In the world of Apple, only renaissance men can become successful writers.

This is what people call progress.

Sunday, January 24, 2010

So having an Ivy-League degree is like having a D-Cup breastsize ?

This week, the OverEasy nightclub has caused quite a stir by offering ladies drinks based on their bust size.

Basically if you are a lady and you have an A-cup bust size, you get one free drink. If you are B-cup, you get two free drinks. If you are C-Cup, three free drinks and D-cup ladies get one free bottle of vodka. AWARE has condemned the action one which objectifies women but that did not prevent 200 women from attending the event, making this a huge marketing success.

While most Male netizens are find it quite difficult to take AWARE seriously, we tend to get indignant when the civil service performs a similar exercise.

The civil service rates civil servants based on their academic performance, if your grades are good, you get to have a higher starting pay. Depending on the prestige of your scholarship, the civil service provides a gradient of salary expectations (currently estimated potential or CEP) based on your performance as an undergraduate.

This makes our civil service almost exactly like a nightclub. If you are a top scholar, it's as if you have a D-cup bust-size at Overeasy. You start with a steep CEP which will be revised downwards only if you screw up badly. A farmer ( local graduate non scholar ) who was hired into the ministries will have a more gentle CEP and will need to produce fantastic results to have that revised upwards.

Both organizations have a good reason to adopt similar approaches to assessing someone. Overeasy knows that by attracting enough women with a D-cup breast size, their business will improve because men want to be in the presence of busty women. Similarly, our country gains credibility if our top bureaucrats are well-endowed with Ivy-league and Oxbridge qualifications, investors want to invest in a country run by well-qualified people.

To study how the CEP approach can be improved, would be to investigate areas where this analogy no longer holds.

The fear of paying a young scholar well and promising them a path to greater fortune before seeing any performance results is that it shifts their risk taking behavior to one which may be over-conservative and something which Singaporeans did not vote for. If I am paid $5,000 to make policy decisions and can try to get a $1,000 increment by doing something significant for the Singapore people, I may actually make a career bet to make things happen. If I am paid $20,000 and can get a similar increment if I succeed, the odds are that I will prefer to refrain from taking big risks in my career. There is too much incentive to support the status quo and even keep a low profile and let the CEP take care of itself.

My opinion is that there are some things which Singaporeans can be enjoying if we can engender more risk taking among our bureaucrats:

a) Singaporeans may be able to opt into a pension plan using uninvested CPF dollars. Our OA returns a pathetic 2.5% but if civil servants have the courage to build an infrastructure for Singaporeans to invest in a low expense, state-supported global equity fund and a global bond fund, an 6-8% ROI over a 20-year horizon is highly probable for everyone.

b) Singaporeans will not be stuck with a 30% limit on investing their own CPF money from the OA account. A civil servant with personal courage is required to conclude that we can independently manage our own money will be willing to raise this to 100% for CPF dollars which exceed the CPF minimum sum.

c) A courageous civil servant will figure out that a Masters education has an ROI which often exceeds equity returns and will allow Singaporeans to use their CPF money to get a Masters degree from a local university to equip themselves with skills to survive in the Global economy.

The civil service CEP system can make with the following overhaul:

a) Start all civil servants at the same grade and do not adjust starting incomes for better academic performance. Adjust salary for nature of work and hardship.

b) Supervisors who grade the civil servants should not have access to their previous academic performance.

c) Promotions and increments are based on the immediate performance of the previous years and will incorporate 360 degree feedback.

d) Civil servants will have to sell themselves using their EQ to work in sexy projects. The projects cannot be given by default to people from more prestigious institution.

e) Allow civil servants to fight for transfers after 2 years in a department. Make retention a KPI for all senior civil servant supervisors.

f) Establish flexible work hours and results oriented approach to assessment. Civil servants should be attracted to the work not for money but for greater work-life balance and enlightened office practices that are more progressive than the private sector.

Thursday, January 21, 2010

High frequency trading and having your own hedge fund.

Right now I've been pretty intrigued by the concept of high-frequency trading. If these experts are to be believed, market efficiencies drop precipitously as we reduce the time we hold our positions. This means that if we buy and hold, we will usually just earn the normal market return but we if hold a series of securities position for seconds or milliseconds at a time, we can potentially earn ridiculous Sharpe ratios of 2000+ which trump even the top fund managers in the world.

What this means is that finance firms already have a stable of IT-Finance types ( like myself but maybe 100x smarter ) writing algorithms in C++ in FIX protocol who are running various programs to take advantage of market inefficiencies to make money in hedge funds.

Unfortunately, my own progress to learn these techniques is hampered by the lack of literature on high-frequency trading.

Some books will introduce the concept to a potential investor but most whiz kids are mum about how these algorithms can actually be written.

If you are interested, take a look at this book from Amazon :

It's full of equations and does'nt actually show anyone how to get a program written.

If you have any insight to building a personal hedge fund, why not share your ideas with the rest of the folks who read this blog ?

Wednesday, January 20, 2010

Financial Recap of 2009 and my predictions for 2010.

Straits Times invited me to give a summary of 2009 and make a guess on how 2010 will turn out. I submitted the following reply. In the end my comments were never published but I'd be happy to share this everyone who reads my blog here.

Just Fire away if you disagree with my projections !

< Submission >

As a person who invests in the stock markets with the objective of covering my basic expenses, my emphasis will continue to be counters with free cash flow despite the good prospects i see for the market in 2010. The difference in my current strategy as compared to the past is that I will focus on equities in 2010 and 2011. I aim to grow my equities portfolio to 33% of my portfolio of REITS, business trusts, and stocks.

1. 2009 for me is like the emergence of spring after a very bitter winter of 2008. My portfolio size dipped 60% despite all efforts to farm my savings back into my investments in 2008. In December 2008, some stocks ( and prices then ) which I held include Ascendas India Trust ($0.435), Cambridge Reit($0.205), Cityspring($0.495), First Reit($0.40), Lippo Mappletree Reits($0.28), Pacific Shipping trust ($0.195USD), FSL ($0.45), MI-REITS($0.26) and SP Ausnet($1.02). I still hold these stocks today, having accumulated my positions since and the current prices in the market today speaks for itself. Some stocks I sold and made some losses because it stopped paying dividends include Saizen REITS, Macarthurcook Properties securities fund and Omega Navigators. A stock which I regretted not holding onto further was Ascott REIT which netted me about 30% gains but would have doubled had I been more patient during the H1N1 crisis.

Not counting the amount I farmed into my portfolio on a monthly basis, I made about $60,000 in capital gains (sans dividends) in 2009. This is very approximately a modest 20% return given that there is almost stock counters in my portfolio. I also made at least $24,000 in dividends in calendar year 2009. ( NB : Actual count exceeds $27,000 for 2009 )

2. My guess is that 2010 is going to be an exceptionally good year. The elections will mean a generous budget for 2010 and the economic stimulus is not likely to be withdrawn this soon. I expect GDP to be revised upwards several times and my bet is that the STI will be in the region of 3400 before year end. The big winners will likely focus on the commodities secular bull trend and emerging markets of China and India. It will also be a year for small caps growth stocks and the return of the retail speculator.

3. Because 2008 has taught me a painful lesson in humility, the best offense for me is still a good defense. These days I ask myself what stocks would I want to own if things do not turn out too well, so despite the obvious possibility of underperformance for 1H 2010, I will continue to build up my large cap dividend stock portfolio focusing on "boring" stocks like Starhub, M1 and SPH for the free cash flow they have. for 2H 2010, I will look for 10 small cap dividend counters to accumulate, I'm still doing my research and have yet to build my watchlist but very likely Karin technologies and Challenger will be part of that list. I hope to end the year with about $8000 - $8500 in dividends every quarter.

4. My only advice to readers for 2010 is to seriously take a good look at your personal finances and determine how much cash you could farm into the markets through your savings. It's tempting to consume and enjoy yourselves when times are good but a recovery like this will not come by every year. If you are not too sophisticated, buying the STI ETF index should reap reasonably good returns for 2010.

< End Submission >

Saturday, January 16, 2010

Love and politics - Singapore style !

Suppose you are male student studying in the Normal Academic Stream in Bukit Batok Secondary school. You've become infatuated with a girl from St. Nicholas Secondary school in the express stream ( she is at least a C cup ). You really want her to be your girlfriend but, heaven forbid, you have a love rival.

Your love rival is a Gifted boy athlete studying in Raffles Institution who is on his way to an Ivy League university direct after 'O' levels.

What do you think is the best course of action ?

a) You call the girl and bad mouth your rival. You say that he does not love her and is seeing other women, some from MGS, and others from TKGS ( Many foreign, with D cups ). You say that he does not have emotional intelligence. You insinuate that he is cold like a robot. You paint scenarios where he leaves the girl for a hotter SCGS girl 5 years down the road.

b) You improve yourself. You strive to discover your strengths, overcome your academic fallings with your streetwise and carve a career as a successful man. You convince her that you have what it takes to looks after her for life and demonstrate that you can protect her from harm.

In any love scenario, it's better to go for (b) rather than (a). When you choose (a), you fail to address the woman's security needs. When you choose (b), you build yourself up to become a credible alternative for the woman of your dreams.

Once you substitute the girl for the Singapore population, the love rival for the PAP and you as an opposition party, you will begin to understand why every election has been a constant disappointment for people who want an alternative government.

The blogosphere is full of liberal commentators who can point out where the problems are. when asked for a solution, they fall back to the common defense "but I'm not a minister who makes millions of dollars, they tell me what the solution is." Because of this attitude, Singaporeans have no choice but to keep themselves in that relationship with the cold but smart RI boy.

Because the government has the solutions and the opposition don't.

I think politicians understand that the silent majority of voters do not really care for the following :

a) Minimum wages, because that will create inflation and up costs for everybody else.
b) Welfare, because that will increase the tax rate and make the whole pie smaller.
c) Human rights, because you simply cannot eat human rights to fill up your stomach.

I want a strong opposition.

My template for credible opposition should function like this, let's just call this the People's Reaction Party / People's Republican Party (PRP).

This party will be moderate right wing to counter PAP's centrist policy making. The party will focus on the following :

a) Immigration. The incumbent government has gone too far and will seek to lower admission rates. This will require a balanced compromise between workers and businessmen. There is a difference between getting 1 million workers to flood the market and meeting the need for skills Singaporeans lack.

b) Wage insurance through CPF. CPF money belongs to the people, they have the right to invest it as they wish and draw upon an amount to maintain their own dignity when they lose their jobs. Singaporean also have the right to lose their money. Come on, we're adults and its our money.

c) Accountability for Singaporean's money. It does not make sense for people not to even have an idea of the risk breakdown of GIC's investments, you can expose the credit risk and market risk variables without exposing actual positions.

d) Laws to reinforce private ownership. Why are Singapore business men taking 60+ days to pay off their accounts payable ? There has to be a convenient avenue for entrepreneurs to get paid for their services quickly to speed up the velocity of money in this economy.

e) Be super harsh on white collar crimes. Time to treat the Durai's, Joachim Kang's and Ming Yi's like rapists and murderers. The damage done to charitable institutions are permanent and the party should support capital punishment.

f) With wage insurance and immigration, we can squash workfare and find ways to make the civil service more efficient and lower tax rates further.

In summary, if social democrats keep rehashing the same issues encountered in kopitiams, they will remain in the kopitiams. Political change cannot come from the left-wing, they've disappointed us for so many decades.

It is now time to shift gears towards the political right, where the focus on keeping Singaporeans competitive with harsh laws and strong families may create the alternative that we've been dying for all this while.

And this time, maybe this time, the RI boy will need to get a new girlfriend.

Thursday, January 14, 2010

Analysis of SPH in June 2009

Not too long ago, I was contemplating the creation of a website using Wiki technology to create a community to contribute fundamental analysis to a site in Singapore for all investors. The is to start with a simple report and then get help from the community to improve the analysis.

Here was my proposed stub for the analysis of SPH.

i) Do let me know if there were any flaws in the analysis.
ii) If there is interest in a combined effort to evaluate the fundamentals of all STI stocks, do comment on this article as well.

Note : This information is dated and does not constitute a recommendation to buy or sell a stock. I do have vested interest in SPH and saw the stock climb since I bought after making this analysis on my own.

Singapore Press Holdings Limited Analysis

SWOT Analysis

SPH's strengths is in its monopoly on the local newspaper scene with the publication of the Strait Times. Media is highly regulated in Singapore which makes it a sustainable barrier to entry in this industry. SPH is also involved in telecommunications and owns two major pieces of property in Orchard road. Investors can take advantage of steady earnings from the media and some growth from its telecommunications and property stakes.

SPH's weakness stem from move made by companies to move their advertising online. Print media and TV advertising is slowly losing its appeal and international newspapers are seeing their finances deteriorating as a result of this.

SPH's future potential lies with the Internet with websites like Stomp. The full potential of social media has not been realized by the local press and SPH should look into seriously experimenting with this new medium to connect Singaporeans together.

SPH's biggest threat is that liberal Singaporeans will turn to alternative sources to get their news. Already, blog aggregators like Singapore daily have a steady traffic of viewers who want an alternative to state controlled information in Singapore. These threats are currently negligible and will not have much impact on financials at the moment.

Relative Market Valuation

Relative market valuation is graded based on the position of the metrics relative to other stocks in the STI index. An “A” grade implies the top 80th percentile, A “B” grade implies the 20th - 60th percentile and a C grade implies the bottom 20% percentile.

Market ratios are taken from DBS Equity Research 2nd June 2009

Ratios Value
P/E 11.2 (B)
P/CF 9.8 (B)
P/BV 2.3 (B)
Current Yield 8.80% (A)

Dividend Discount Model

SPH is a steady blue chip defensive stock, when discounting dividends we can treat the cash flow as one delivered by a government bond. We adjust the risk free rate by 1% to account for the slightly risky proposition of buying equities. We also make a very conservative estimate that SPH will not grow at all in perpetuity as in 2008 since SPH has been giving almost all of its retained earnings out as dividends.

Assuming discount rate, r to be (10-year SGS long+1%) bond

r = 2.74% + 1% = 3.74%

Dividends in 2008 = $0.18

Projected dividends in 2009 ( Conservative ) = $0.15

Intrinsic cost per share = D(1+g) / (r - g)

Intrinsic value assuming a growth rate,g of 0 = $0.15 / 0.0374 = $4.01

Free-cash Flow discount Model

Using the same assumptions, we can derive the intrinsic value of the share by looking at the SPH Free cash flow model.

Cash Flow from operations = $457 million

Capital Expenses = $55 million

Net Borrowing = $0

Free Cash flow to Equity = Cash Flow from operations – Investment in fixed capital + Net Borrowing

= $402 million or $0.253 / share

Once again, assuming no growth of Free cash flow to equity,

Intrinsic cost per share = FCFE(1+g)/ (r – g) = $6.76

Residual income method

The residual income method adopts a different approach from the rest in that it uses book value and return on equity to derive the instrinsic value of a share. This approach works for shares which have negative earnings, cash flow or does not pay out dividends.

Book Value per share taken from analyst report = $1.319

Return on Equity = Earnings per share / Current price = $0.276 / $3.10 = 8.9%

Long term growth rate = 0%

Intrisic value per share = Book Value + Book Value (ROE – r ) / (r – g ) = $1.1319 + (0.089 – 0.0374) $1.1319 / 0.0374 = $2.69


Based on analysis on this page, would be a good investment for its high yields and monopolistic position in Singapore. Models of cash flow show that the intrinsic value of the stock is high compared to current price. Residual income method projected the lowest intrinsic for stock price but the model is more appropriate for companies are losing money.


Growth Portoflio = Neutral
Income Portfolio = Very appropriate
Speculative Portfolio = Not appropriate
Diversification Portfolio = Neutral

Tuesday, January 12, 2010

Zorba the Greek and our perception of time.

I was acquainted to Zorba the Greek because of forays into Lifestyle Design.

Having only read less than 50 pages, the deep insights into life as exhibited by the title character already has useful insights that we can all learn from.

I think that there are two special types of people that we can encounter in our daily lives.

a) People who live their lives as if they will live forever.

These people do have yet to feel their mortality. People who act as if they'll be around forever ( like myself ) is always be concerned the about the future. We are always planning our contingencies and taking steps to sacrifice the present for the future. People in this category are conscientious and have a future orientation towards time.

b) People who live as if their lives can end any minute.

These people know that they live finite lives. These people do their utmost to enjoy life's simple pleasures because no one can really know what is happening next. They are action orientated and always around to find amusement even in the most mundane of things. People in this category exhibit a deep open-mindedness and have a present orientation towards time.

Unlike Zorba the Greek, I will not favour one mode or lifestyle for another, I think that there is a time and place for everything. Younger folks with their sense of invincibility should make some personal sacrifices and delay gratification to bring something important to this world prior to reaching middle-age. After middle-age, it's wiser to come to terms with one's mortality and start thinking of ways to enjoy life better and find pleasure in one's families.

What is interesting is that finance theory can benefit people who adopt both philosophies.

People who live as if they will be around forever should take need of compounding value of money. Saving and investing for the future will allow one to compound their assets and create a powerful second stream of asset enhancement, hence increasing the quality fo life in the future.

People who live as if they will die every minute should start thinking about the compounding value of time. This concept is more arcane and fewer people understand how this works. When we compound time, we find ways to do more with less so that the time we get can be spent doing something that we enjoy. One example is through automation. Can the work we do be automated with macros and scripts ? Another is through outsourcing - can our work is givne to someone who can do it better for less ?

In summary, we should try to emulate these two special types of people. We should avoid becoming the third kind of person. Someone who lives without any inkling of his mortality and neither prepares for the future or revels in the present. You know who these people are : fatalistic types who keep trying to remember the good old days and blame all the changes in society and all this while marching slowly towards oblivion.

Stories of hope are never written for such people. Tragedies are.