Saturday, May 21, 2022

Some financial lessons I learnt from my recent trip to KL.

I've got quite a lot to talk about my trip to KL, but I will wait a couple more days and instead just focus on the financial bits first. In a few moments, I need to examine what can be salvaged from the Terra blockchain implosion so folks can catch up with me on my next preview on Tuesday, which will be changed, once again, to reflect the realities of the crypto space today.

So one of the highlights of my trip was meeting my cousin's old secondary school classmates. I met some of them years ago and one or two have become regular readers of this blog. As alumni of the prestigious English College in JB, my cousin's pals are fairly high SES - you can imagine some kind of RI-ACS hybrid if you translate them to Singaporean terms. As adults they are super-qualified, cosmopolitan and globalized citizens and have a very interesting if somewhat un-Malaysian perspective about life. 

I think I picked up one novel or two lesson from them. 

One of the flaws about being Singaporean travelling to Malaysia is mentally dividing everything by three when we look at Malaysian prices.

As a consequence, everything we see in KL is cheap. 

The first leg of the trip we ate well, but the prices are cheap only relative to Singapore. Malaysian locals can't eat like we do every meal. ( The noodles I ate shown above cost $90 MYR, and standard has dropped greatly ). 

On my second leg where I went around with my mum, we ate what local workers ate and avoided expensive restaurants. The Chee Cheong Fun from Petaling street is $8 MYR, possible the second best in Chinatown as number 1 was either gone or not open on that day.  

Here's the insight. One of this blog's readers is my cousin's pal who works in a fairly prestigious startup in Singapore. His commute is tough - he lives in a hotel a couple of nights a week here before going back home to Malaysia. 

He's actually got a lot of respect for Singapore hawker culture, which if you think about it, would be unusual for Malaysians because they have to multiple the costs by 3 when they buy food here, and food at home seems almost always better in terms of quality and taste.

His reasoning is simple - Singapore has kept a lid on food prices relative to our salaries while Malaysian's spent a larger proportion of their earnings on food. 

$8 MYR for Chee Cheong Fun in KL is a steal for a Singaporean, but it's not a joke for locals who have to contend with these prices on a regular basis. 

One of my cousins's doctor pals told me that he spent $40 MYR on chicken rice. To be fair, he added char siew, roasted pork and more chicken into his rice and the price inflated to $40 MYR. My cousin's other pal even said that individual portions have gone up to $70 MYR for chai png when they were feeling really decadent and hungry.  

Finally, one of them asked me how to FIRE like that ?

As a loyal patriot, I have a simple answer :
  • These are the best of the best Malaysia has. So naturally, Singapore wants them too. So step one is find a job here.
  • Open a brokerage account here and buy our REITs to get about 6% dividend yield.
  • I think it's possible to open CIMB bank accounts in both SG and MY branches so dividends can be channeled across borders. My cousin is testing this technique. I'm still investigating this for my mum. 
  • Practice geo-arbitrage. Work and save in Singapore. Spend in Malaysia.
  • According to my ERM research on Malaysia Expat cost of living it is only $14,000 SGD a year. $240,000 SGD in Singapore REITs yielding 6% can sustain an expat lifestyle in KL. In Singapore, you will need $500,000 SGD to lead a basic subsistence.    
  • Just completely ignore your CPF contributions. You will get it back one day. No Malaysian ever regrets leaving his money in our CPF system given the way our currency is strengthening over the years.  
Of course, for such eligible professional Malaysians to work in Singapore, many things can happen to torpedo this plan. One possibility is that they can get entrapped by our women and live as slaves to money forever.

That's not entirely a bad thing for Singapore.

So to the elites of English College, please come and take our women !



Saturday, May 14, 2022

Yes, I am now in the Million LUNA Round Table or MLRT !


Before something goes really wrong for me, there will always be some kind of foreshadowing. 

A week ago, I gathered with my SMU JD classmates in one of their apartments and we updated each other on our career progress ( or lack of progress in my case ). I realised that none of them are really aware of what's happening in the crypto landscape and, just for fun, I decided to pitch the general idea behind the Terra blockchain to see if they will buy it, lawyers being pretty smart people.

The cut the long story short, I totally failed. 

My pals do not buy the 18+% Anchor protocol at all and every effort to explain how a central bank facility and the workings of the LUNA-UST pair was unable to convince them to accept that such an idea is feasible in any way. 

At that time I dismissed their concerns because I thought perhaps I was not convincing enough. After all I got a shit B grade for International Moots. It's not easy to get lawyers to buy into anything, and all of them rely on their salaries as their primary source of income.

The rest is history as my classmate's skepticism was proven right.

My damages were slight, so far I have lost about $16k. If I had conducted more classes on crypto, my Anchor holdings would have been higher and I would have lost more. It was sheer luck that my entry into crypto was less than 1% of my net worth at the moment Terra collapsed. Right now, the biggest source of damage is the effort I put into my course slides which need to be retooled away from the Terra blockchain which means a third of my material needs to be rewritten from scratch.

I just want to say something about Ponzi schemes as a skeptic, and a trainer who did lose money just in one :

So long as women continue to choose men based on his ability to obtain economic resources, guys will always look for the next best way to make money, juts to impress hot women. If you can find some purportedly riskless approach to make 20%, even folks who are aware and document the risks like me will put at least a token position to experience the thrill of winning, if only for a short while. Genting is a company that exists solely to provide this kind of entertainment. 

Prior to Anchor, I've been burnt by shipping trusts and Eagle Hospitality trust, in all these moments, I knew that something was wrong but I like the double-digit yields. I think the solution was never to avoid such schemes which are too good to be true, but to do position sizing so that a loss will not hurt you this much. 

So would I play 0.1% into Do Kwon's next project? I definitely would!

Anyway, I always believed that in great moments of chaos, anything can be a ladder.

At the moment, everyone is pounding on LUNA investors with "I told you so" kind of articles. I thought maybe I do a final "Hail Mary" manoeuvre on the Terra blockchain and mess with critics before it collapses for good.

So when the Terra blockchain was shutdown, FTX was the only exchange that was allowing trades on LUNA. 

I gathered all the referral coins I earned from my students from different platforms. ( I will not even touch my dividends for this Hail Mary attack)

About $150 USD worth, pumped it into FTX and bought for myself 5.45M of LUNA!

My entry price was around 0.000027+. One day earlier, I lost $2,000 buying LUNA at $1. I figure that the infrastructure and engineering talents in the Terra ecosystem cannot be worth so little so the least I can do is to donate to this engineering marvel.

So just like that, I ended my LUNAtic adventures a LUNA multi-millionaire.  

I am now an MLRT! 

Now anything can happen. 

At the moment, I have almost earned x8-10 of my investments, but to recoup my crypto losses it needs to go up another 10 times. 

I probably will not move this asset until it is large enough to offset my home mortgage so paper gains will just give me more bragging rights.

I'm going on a trip, this blog will be back next Friday !

Wednesday, May 11, 2022

A LUNAtic is born !


Yesterday morning, the other Dr Wealth Crypto trainer messaged me on FB and told me of the depegging event for UST. I checked Yahoo Finance, and yes indeed, the worst has come to pass in the Cryptocurrency landscape. 

One of the most viral stablecoins UST has lost it's peg to the USD !

This depegging of UST from one USD is possibly the biggest event in crypto as it proves that algorithmic stablecoins are not exactly stable over the long term. I assessed the damage to my holdings. I lost about $5k from the entire depegging process in my $30k cryptocurrency account. It's a drop in the ocean because I was only ready to hit 1% of my assets in Crypto by the end of the year, so I have little skin in the game as of now.  While most of these losses are in UST Anchor protocol, it was my liquidity pools which took most of the damage. 

But there are reasons to celebrate:
  • A 30% drop in stablecoin value is no big deal compared to what tech investors are experiencing as of late, as a product of Singapore's education system, I know it's not important how well you fare, but also how badly others do.  No point in choosing to be a millionaire surrounded by billionaires.
  • Amazingly, collateral-backed stablecoins like USDT and USDC remained stable these few days, so at least the strategy of diversifying across stablecoins worked to mitigate losses for my students. I even expect some students to miss out on Anchor protocol because setup is so complicated.  
  • The third reason is LUNA :
When I backtested LUNA, I did not like what I saw because it was highly volatile, so formally, I don't teach my students to buy LUNA. Even if they do, it will be part of a bespoke index I build using software tools involving the largest non-stable coins. None of the software tools would have supported a buy since my first course was run in April. 

But, at the back of my head, I witnessed LUNA turn pals into multimillionaires because they got in at the right time. LUNAtics are the Insane Clown Posse of the crypto world, the crazies who follow Immortan Joe in Mad Max. Not everyone likes them in the crypto world because they can be quite religious when it comes to investing. 

LUNA is now trading below $15 when it was close to $100 weeks ago, so this morning, I took the plunge to become a LUNAtic myself! Of course I did not hold the LUNA as LUNA per se, I invested it into a bLUNA-LUNA pool for 80+% a year and a even put in spare change for a LUNA-UST pool for 1,060% p.a.

Want to go retard, go full retard all the way!

I bought about $1,000 worth of LUNA. If LUNA drops further to $5, I will buy $5,000 more. Of course, I will only buy LUNA with my dividend payouts from my REITs, and I will not sacrifice earned blood money on this. My trainer revenues will only be put in a diversified stablecoin portfolio.

At the end of the day, the entire algorithmic-based stablecoin regime may end in a few days time. Maybe after this, no one will back an ecosystem like Terra anymore, but there is also a reason to believe that even a salted fish can resurrect itself. I have no idea how the UST peg will restore itself, or whether LUNA will even climb back to $20. 

If it happens, it happens, and I will possibly make a decent amount out of this.

My crypto course will conduct a preview tonight. I hope to have a fun discussion about my latest moves on UST and LUNA. 

Follow this link:





Monday, May 09, 2022

On Benz Hui, greater intelligence, and small intelligence.


Most folks in my generation grew up watching HK drama, so many Singaporeans are familiar with Benz Hui who is an accomplished HK actor who has settle down permanently in Singapore. Of late, Benz Hui has said some candid things about Singaporeans which I think deserve a good solid rebuttal. 

That being said, I'm a fan of this great guy, and I think we should be grateful that Benz feels comfortable criticizing us - if anything it means that he has found a new home. 

One of the things I was grateful for growing up was my exposure to HK D&D players which shaped the way I play RPGs today. HK players took me under their wing and presented a new play of playing Dungeons and Dragons. The style was pure mayhem, and channel HK comics like Dragon Tiger Gate rather than Western fantasy canon. 

Singaporeans were stickler for rules, so our gameplay was not inspiring. My paladin would just attack with his Holy Avenger round after round, not really inspiring.  My HK gamer senpais told me never to question what the rules allowed me to do, but to find actions that the rules never explicitly said no to. 

The result was hilarious. 

In one game, a cleric was told that to create an artifact he needed to place on an alter a vessel that can contain his deity's power. He declared that there was no better vessel than himself and turned himself into a living cleric-artifact. The DM allowed this to go on for the lolz. The cleric was able to develop artifact powers after the ritual. He infused his left had with the Heal spell and his right hand with the Harm spell and became almost invincible in combat.

My HK mentors also taught me a bit about life which I internalized to this very day. One lesson when I was in JC  was  to stop daydreaming and never waste time queuing for fast food, if a queue shortens, I should be ready switch queues. I extended it to includes tasks like preparing change before it was my turn to order.

But eventually, we all have to grow up as adults. I have to complete JC, get into the Army and eventually study for my degree. 

In that process, I stopped looking up to the HK mentors I had.

For one thing, D&D as a game improved it's writing and the rules became a lot clearer and the chaos mayhem style of HK players lost its favor. Instead, a close reading of the rules that allowed different rulesets to synergize with each other made our characters more powerful. Reading became more competitive and intense and you can be rewarded by a strong fundamental grounding of the ruleset.

In real life, HK gamers lost their cushy operator roles to IT engineers from India and had to return to HK. Their careers never recovered and some refused to meet my pals when they visited. I know that even those days, their chaotic attitudes to life also prevented them from making investments and I suspect may struggle financially to survive today.

In the grander scheme of things, how can a bunch of stoners Singaporeans, derogatively called "Po Zhai" and "Mm Seng Muk", become an economic powerhouse that can even eat the lunch of possibly the finest entrepreneurs and businessmen of the world ?

Hong Kongers focused on small intelligence, tiny improvements that are wise for that context, just for that moment. The dumber Singaporeans were more obedient and malleable, but we focused on greater intelligence, employing mental models to understand rent-seeking, investing and developing skills in artificial intelligence and blockchain programming. We were slow because we were united and saw multiple steps ahead. 

Plugging the trust ABSD loophole is a deliberate move NOT to become Hong Kong.

I doubt my HK mentors will like me a lot today as I pull rental payments out of thin air, engage in liquidity mining, juggle my three degrees, and only leave for work only when I feel like it. Few of my friends who knew me as a joker and a troll would like my current setup. 

It's not too different from Benz Hui. His best anecdote is that HK doctors fear Singaporean patients because we challenge their decisions all the time and we're too smart for our own good. 

For one thing, Singaporeans doctors are quite used to this. For another, there is actually an economic idea called adverse selection that explains why it's perfectly rational for Singaporeans to be that way.

At the end of the day, doctors may have some kind of oath, but they are also in the business of selling medication. As it turns out, doctors know a lot more about medication than their patients, so an information asymmetry arises. Maybe the doctor is selling a drug that is high margin or an operation was suggested to earn more profits. To understand whether a cheaper alternative exists, it makes sense to study every alternative and challenge the decision of medical practitioner. Bridge the information gap. 

Even our common law supports the idea that doctors should render advice like provide alternatives to each treatment ( Montgomery test ) - we're actually helping our doctors too!  

Even if we do give doctors a break, I strongly urge readers to spend time studying the products sold by insurance agents. If a commissioned salesman makes an aggressive recommendation, you will definitely profit by seeking alternatives. 

Finally, I don't think Singaporeans will stop studying and questioning just because Benz Hui says so, if anything, his grandchildren will be Singaporeans and will as kiasu and kiasi as we are. Similarly Singaporean D&D players will not go back to an older edition of a the game to play something that results in pure chaos like improv theatre.
That being said, we should open our doors wider for HKers to come down to teach us a bit about the small intelligence of starting businesses, developing grit and self-sufficiency, it will compliment our existing strengths very well.  

Thursday, May 05, 2022

Test trip to JB !


It's been two years since I travelled, so after the long public holiday, my brother in law drove me and my mum into JB to settle some banking matters which have been stuck for close to 30 months. We've collected rent for over two years and because of the old bank setup, the money was stuck for a long time and we had to endure the currency depreciation of the ringgit over the past 2 years. 

I just want to highlight some points of my trip so that readers can avoid the mistakes I experience today.  A lot of unpleasantness when resuming travel can be avoided if you read my blog.

a) PR's need to update re-entry permit.

Because I am not a PR and deal with matters for my mum online, I misunderstood how re-entry permits worked, I thought it's something that is based on dates and it just needs to be renewed. Today we had issues with ICA because while we have a recent re-entry permit, but it was keyed to the older passport and I did not transfer it to the new passport. ICA was very patient with us and let us through but I have to resolve that issue online after I came back. 

If you do not valid re-entry permit as a PR, the electronic gateways will not admit you and my mum was ping ponged a couple of times in Singapore customs, so please respect and follow the rules. Best thing is every time you renew your passport, just update the re-entry permit.

b) Touch and Go card.

Our troubles did not end there. Having a Touch and GO card is vital to get into Malaysia but we did not have a card with credits. We got stuck after our passport was cleared in Malaysia customs. Lucky, my plucky BIL managed to seek help from a customs officer and we were able to clear customs, but if you don't rely some some persuasion, I really would not know what would have happened to us.

This is, apparently, a major issue for drivers. 

Of course, my troubles did not end there.

c) Breakfast was good.

The only good thing that happened today was Storia Cafe, their mee siam and Otak is out of this world. Go google for details before your next trip. The boss has a reputation for being a damn nice guy and he rounded down the bill. In the end, I paid $3 SGD per head for a full breakfast !

I'm grateful to my BIL who researched that place thoroughly and it was his first meal there too.

d) ATM card fails after long absence

So all I wanted to do was some banking. We could not withdraw money because the ATM card expired and undoing it would mean an hour of wait. There are two manual forms to fill but lucky the staff we had was super steady. Bank was obviously understaffed even though they should expect hordes of Singaporeans to come down to make withdrawals. 

One poor Singaporean uncle I met actually could only complete his work on his second visit. It was just a long line of sad looking Singaporeans at the bank today because they can't withdraw their cash.

e) Bank probably cut into a new database, so may not have your records.

Oh it did not end there. My mum has been banking with the same branch for 30 over years and they claimed not to have my mother's PR status, so we had to fill more forms to update the database.

f) Strange questions asked during TT of cash to Singapore. 

The thing about TT to Singapore is that AML measures need to be taken, but this was not the first time we did this. We had our Singapore bank books, but staff wanted to confirm whether the joint account can be acted upon independently and this confused my mum and I could not recall what the right answer should be. I had to be there to answer some questions for the paperwork to clear.

For noob, make sure you copy down the SWIFT codes for the local bank and account number manually before you go and bring an account statement or bank book with you. I panicked because I had no data plan in Malaysia and had to use Wifi until I realized my mum had the Singapore bank book along. 

Naturally we did the paperwork successfully but it will take a few days to figure out whether we succeeded. 

I think there are probably a lot of savvier guys who can think of better ways to go about doing what I did. I'm largely constrained by the systems setup by my parents 3 decades ago and most of the paperwork is not under my name. This is not sustainable, so starting tomorrow, I will be actively trying to decouple my mum's current bank from our family's financial operations and building a better one that works online.  

Overall, the trip was worth it because it solved a lot of ongoing issues with family finances. Otherwise, it was really sad to see the devastation of City Square, MPH Bookstore is gone but fortunately, I got some really good Malaysian finance books in Popular bookstore. 

It's one thing to feel powerful because your dollar is worth more than three of your neighbors currency, but if there are only a few shops to buy stuff from, what is the point ?

City Square will probably heal in six months. I will take few more surgical trips to Malaysia on weekdays to visit other areas like Midvalley Southkey, but I think a bus trip to KL is in order.

Saturday, April 30, 2022

Being aware of the latest FA tricks of the trade.


Ever since I completed my last batch of students, I've been trying to expand my social circle through outings meeting with collaborators and students so that I can remain updated with whatever young folks do. Along the way, I've picked up new tricks that FAs are pulling to get more sales prospects so that can warn folks what these latest techniques are :

a) Selling insurance by matching folks in dating apps

So one trick in the book is to get into a dating app like Tinder, or Coffee Meets Bagels and choose to date any guy with the aim to sell insurance and financial products to them. This is actually quite frustrating for single guys who struggle to get a date and who may be anticipating the outing for a while, only to be sold ILPs in that meetup.

I think these apps actively discourage such behaviour from FAs but I'm also seeing a variant strategy where the date proceeds as per normal the first time around but selling only starts on the second date. Maybe this way, it's not a violation of the T&Cs of the dating apps because the second outing is arranged through a different medium.

The only way to prevent this from happening is to really have a clear idea of your self-worth. If you are a 5 and some girl who is an 8 or 9 accepts your date, maybe you want to find out what industry they are in before you get too excited.

( Not pertinent to this discussion is that I heard that there are a bunch of muscular guys selling gym memberships on dating apps, so women are not spared. )

b) Holding a second part-time job as a sneaky disguise to pounce on leads

It gets worse. I learnt from a student that more sophisticated techniques exist, and FAs are popping up in places you'd least expect. 

I heard that a FA actually picked up some Sommelier certificate and actually found part-time work in some wine place that organises singles events. She will ask single men out to sell them insurance. 

This is a very high-level play because the last thing you'd expect is someone with a formal job is actually an FA as well. 

When executed well, I can't think of any defence to prevent the date from becoming a waste of time. 

Fortunately, I've only seen single men fall prey to this, but if FAs can take on any part-time role, any business meeting can be weaponised for sales. I can imagine an influencer wanting to collaborate with me on a video may try to sell me stuff in that meeting - but I will ensure their reputation will not survive if they waste my time this way.

c) Hiding in "finance mastermind" groups. 

This comes from my personal experience.

A couple of ERM students and a collaborator of mine are mutual friends and we arranged to meet each other last night at Keong Saik Road. When we are arranging for the meetup, a student asked me whether I can allow an FA to show up. I was puzzled how the meeting details got leaked, apparently, my students tried to organise the meetup in a telegram group that focuses on finance discussions. It's a small group but has at least two FAs.

Once this FA heard about this, he tried to shift the meeting venue to his office!

When I heard about this incident, I got so mad, I said I would not show up if the FA comes. I can take a drug addict, a pimp, or someone that's been to jail, but no way I will allow a commissioned FA to gatecrash a drinking session with my ERM students.

It's not to protect me and my friends, it's to protect the FA! 

I explained that I probably would not be able to remain civil and I will openly rub the fact that I am a multimillionaire without ever accepting financial advice from an FA. I will brag about my cheap SAF Group insurance. I will make him question his very own existence in this universe.

I know that in the age of Telegram and Whatsapp, it's very common for folks to build discussion groups. I'm in several myself, but I also am aware that salespeople tend to hijack the discussion for their own purposes. One group I am in has real estate agents and every day it's just airy-fairy talk about condominium launches.

Sometimes I blame Napolean Hill for coming up with the idea of a mastermind group. Set a standard for your friends, if they see you as a source of revenue, you may wish to think twice before committing time and effort to a network. 



Tuesday, April 26, 2022

Back to the Grind


As I've spent the last weekend busy running my course, I spent the first few days of this week recuperating. I don't know why it's been such a tiring weekend. This week has been spent trying to get as many social engagements I can because I'm still stuck in Singapore running course previews so I can't take a trip to JB. I'm highly likely to go in by bus in May, but I intend to go when few are attempting the trip. 

I'm still dead tired but I started updating my Cryptocurrency notes this morning. I think things have changed so much I am overhauling 20% of my material :

a) now accepts FAST transfers from local banks, rendering my notes on a centralized exchange obsolete. Significant portions of material became optional overnight, but this should make it easier for older investors to get started in crypto. 

b) I'm now more open-minded about liquidity mining and think 1% allocation is ok, so I need to ramp up my notes in this area. Mouth watering yields over 100% is possible but so is losing your pants.

c) I suspect one of my students installed a hacked Terra Station wallet and it siphoned off his funds. The amount is small but I have to incorporate some troubleshooting notes. How do we the software we are installing is the right one? If we cannot answer these questions definitively, investing crypto will continue to be a bad idea. 

I'm slowly beginning to realize that my course material is several magnitudes more dynamic than my notes on traditional dividends investing so creating an online webinar may not be feasible and I need to continue to run my classes live and adjust the fees accordingly. 

As a business, we have go with our gut feel and learn new stuff along the way. I think there is blue ocean for trainers who can combine traditional and crypto investing in a coherent way that respects the fundamentals of finance. 

How to really get there is the problem.


Saturday, April 23, 2022

Letter to Batch 25 of the Early Retirement Masterclass

Dear Students of Batch 25,

It’s been a great honour and privilege to conduct a 5-Day Early Retirement Workshop for you.

The current economic situation is a precarious balance between the optimism of recovery from the Omicron strain. I expect the following week to be bullish for Singapore markets as we move from DORSCON Orange to DORSCON Yellow. This will be primarily for REIT counters related to office and retail spaces.

However, there are dark clouds on the horizon. 

America is looking at PE ratios above 35 and an inverted yield curve. Interest rates are expected to rise and while this will benefit local banks, it would be detrimental to growth sectors like Tech. We are also in the middle of a conflict in Eastern Europe, and any form of escalation will not bode well for our investment portfolios. As China grapples with COVID-19 without an mRNA vaccine to call their own, we cannot rule out a technical recession in Singapore as China stubbornly adheres to the zero COVID policy. However, I would like to think that, if this happens, this should be a bargain-hunting opportunity.

Nevertheless, Batch 25 has taken a slightly higher risk in-stock selections, likely directed by the factor models we’ve built. We’ve accepted 15 counters and rejected 8 of them with a strong bias towards higher dividend yields, and the final portfolio is projected to yield 6.2%, which is not too bad for the current climate.  

I’m cautiously optimistic about the performance of this batch of students as we’re coming in at a point when the equity risk premium of the Singapore stock market has been rising for three consecutive courses I have run, but no investment strategy is fool-proof. I wish that students can take the lesson to heart that a 2-standard deviation drop from the mean can still mean a hefty 15-20% capital loss.

Lastly, I hope that Batch 25 will participate actively in the FB group. Sometime in Q2 2022, we should be meeting up for an online community webinar. At the time of writing, I have yet to determine the subject matter of this discussion, so suggestions are welcome.

Hope to see you then!

Christopher Ng Wai Chung

Wednesday, April 20, 2022

Too true to be good


The traction for the last article has been quite good and we're seeing some younger investors come up to support the idea of LPFIRE that employs liquidity mining to get over 100% to offset basic expenses. 

Viability aside, let's look at the primary opposition to the idea of Liquidity mining which is based on the idea of "Too good to be true".

A useful rule of thumb in investing is the idea of "too good to be true".  If an investment idea is "too good to be true, it is best to avoid it". If you go by this creed, then you would have avoided most scams out there which include Ponzi gold schemes, and land banking deals that are at 12% with capital guaranteed.  

The question has always been execution, to know that something is too good to be true, you need an understanding of baseline returns, equities return about 6.8% after accounting for inflation, so most claims of anything above 10% tend to involve a little bit of luck so should be avoided unless more data can be shown.  

It is therefore no surprise that many investors deem crypto yield farming as largely too good to be true. I don't see any need to dissuade these investors but note that the baseline returns for bitcoin stand at about 90% annualised. It can also be argued that no baseline exists. 

So suppose we apply Charlie Munger's idea to invert, what is the opposite of "too good to be true"?

I think the answer should be investment schemes that are "Too true to be good."

This is also a powerful mental model we need to install into our OS. Notice that the same folks who are not open-minded about new investment ideas also tend to err on the conservative side when it comes to investments. 

I did a casual google search for endowment plans sold locally and so far, there are plans that make you lose liquidity for 2-3 years and pay less than 2% a year when held to maturity. The folks who invent and hawk these products are really shameless given that our inflation rate is hitting 4% and getting into these products will guarantee a loss in real purchasing power over the next 1 year. 

It's almost like dating for BBFAs. 

Crypto yield farming is like the hot chick who rates 9/10, clearly out of your league, but for reasons unknown, enjoy hanging out with you. Naturally, you should conduct deal diligence to find out what is wrong with her, maybe she was born male, or owe loan sharks a lot of money. But still 9/10 should mean something right?

These chicks are too good to be true.

The question is whether your self-esteem is so low that you avoid this earlier chick in principle, and instead, go for a chubby, plain looking 2/10 that prefers korean drama to dining in with you. In this case, you are guaranteed no competition if you go after her. If anything, you know that the ugly, chubby kids you have in the future are definitely yours.

This second chick is too true to be good.

I think in all matters, you need both mental models to navigate the investment world and should find a fairly good portfolio that conforms to your risk appetite. 

Crypto bros will ask you to give 9/10 but maybe a tranny a shot. Commission Financial Advisors selling endowments want you to settle with ugly chick and have really BBFA kids who are guaranteed to be yours.

Which will you choose ?


Sunday, April 17, 2022

Will this Quick and Dirty FIRE for desperate people work in practice?


I was contemplating whether this post should be shared in the Dr Wealth blog but thought otherwise because this idea can be very controversial and I expect a healthy round of debate around this idea I have.

One of the things I do above and beyond training and investing is to challenge myself to see whether I can invent new ways to attain financial independence. And one of the things I teach my students to be wary of is liquidity pools. The idea is that for exchanges to be run in the cryptocurrency world, some folks need to provide liquidity in the form of currency pairs, those who are willing to do so can be rewarded. For obscure pools that need liquidity, rewards can be over 100%. The catch is that yields fluctuate and you get rewards in the form of tokens which can be volatile.

Naturally, I've been playing a few pools myself and after putting about $5,000 into a mix of these random currency pairs, I'm getting about $10 UST a day.  When these pools hit about $50, I would farm it again to an attractive pool that yields over 100% and I will see a gradual increase in my daily earnings over time. 

Do note, however, that this is chump change to me and I do this for fun, much like what folks will do at blackjack tables in casinos although I think that I'm doing much better than most casino customers. Sometimes I do this because I can warn my students and tell them not to. 

I think that once you can accept that yields are not sustainable and you can even be subject to possible fraud, it may be possible to invent a new quick and dirty form of FIRE. This form of Liquidity Pool FIRE may lack the sustainability of real FIRE, but with small amounts, you can skip other forms of FIRE like CoastFIRE or Barista FIRE and "zerg rush" your way to financial independence.

The math is very simple. If you can live on $24,000 a year :

  • A REIT/Bluechip portfolio yielding 6% needs to be $400,000 to sustain your lifestyle.
  • A stablecoin portfolio yielding 10% needs $240,000.
  • A diversified liquidity mining operation yielding 100%, needs only $24,000.
So I think a new form of lifestyle design can revolve around LPFIRE.

You save aggressively to hit $24,000 in your liquidity mining operation. Once you hit this target ( some fresh graduates can do this in 6 months ), you immediate pivot your full take-home pay into other FIRE buckets :
  • The first bucket is to maintain $24,000 in your LP operations which can lose value quickly due to currency fluctuations and impermanent loss. There will be months you need to plug the leaky holes on your ship, how else can you get >100%?
  • The second bucket is to start building a REIT/stablecoin portfolio to build a more stable version of FIRE. I prefer a 90/10 mix of traditional assets to stablecoins, but you can choose your own allocation. 
The benefits are largely time-based. Imagine getting some form of financial independence within 6 months of starting work and farming your entire paycheck into a more stable form of savings in your mid-20s.

The real benefit is to decouple yourself from an earned income in your mid-20s so that you can really hit your FIRE target using more stable assets. It will take 2.5 years to cover $2,000 via stablecoins if you earn $100,000 a year. After that getting that $400,000 in REIT/stocks would be easy because you have an extra $4,000 every month to build your real estate hoard. 

Of course, there is a high probability that over time some pools will fade away without making you money, you also may have to shift your funds around liquidity pools over time. 

The element of luck may still play an important role in your journey. 

I think in practice, the biggest weakness of this plan is whether any investor who gets drunk on 100%+ yields would have the willingness to buy real estate at 6%. The other issue is whether he can maintain his interest in regular employment when money can be obtained so easily. For this to work, you need to promise yourself that this is not real FIRE but merely an accelerator towards FIRE using traditional assets. 

But I think this idea sure beats putting into a 2% short-term endowment when inflation is twice that amount right now. 




Thursday, April 14, 2022

Structure vs Agency - The Unwoke View

The Woke Salaryman has once again hit the ball out of the park with this comic strip which you can read here. It's a very classy piece that really puts these folks a cut above the other comic strips that talk about personal finance. 

I really like the sociological concept of Structure vs Agency. In our push for greater status in society, part of our results come from our personal drive and motivation, but a significant amount comes from structure, which is the environment we are born in - it can be wealthy parents, our gender or race.

What I find interesting is that Woke Salaryman has subtly lived up to it's Woke name by putting slightly more emphasis on structure, this is something I deeply disagree with. (although woke is woke lah) 

Structure does play a role in a person's success, but how much it plays is a question of how much let it play a role. Right now, I'm just happy that our next PM comes from a neighbourhood secondary school, if we keep having this chip on our shoulder about the weaknesses of the institutions we grew up in, it would horribly impair our ability to rise in this world. One of reasons I'm especially motivated when facing elite competitors in JC was because my secondary school was run so badly, the top Pure Science class did not even have a classroom - our principal housed us in the physics lab and kicked us out whenever class needed access to do experiments. My personal narrative is that there is really no choice but to climb in this world given how shitty my secondary school education was in the late 1980s. If I elevate myself further and get to speak to my juniors, this is definitely a story I will tell.  

 If you really examine younger Millenials and Gen Z, everyone has two daemons whispering in their ear. One daemon looks suspiciously like Karl Marx and he likes to remind the person that society plays a big role in their success and structure matters a lot. The other daemon looks suspiciously like Ayn Rand, and she wants to remind the person that agency matters more. 

  • If someone wants to believe that he's screwed because society did not give him a leg up. He's probably right.
  • If someone else wants to believe that he can use his willpower to improve his lot in life, he's right as well. 
Like what the folks of SGAG would say : Can is Can. Cannot is Cannot.

This week, I met up with an old gamer pal lately and we were updating each other about how other gamer pals are doing, and we came to the conclusion that my pal has elevated himself over the other gamers as he reached his 40s. I suspect he never saw himself as a candidate for top dog, given that he had credentials in design from a private university, and flitted like a butterfly across several service level jobs in his youth.

But as he mellowed down and grew older, he managed to land an administrative role in an office and he basically showed up every day for a decade within that same organization. Today, he was even able to make hiring decisions for his organization. 

I felt that he followed something Jordan Peterson has been telling a lot of young guys. No matter how low you are at the starting point of the totem pole, just make it a point to show up and be engaged in your work. This puts you above maybe 75% of your peers. 

The gamer circles I was in, on the other hand, had not aged well, with some local grads getting managed out and driving Grab today, others have been structurally unemployed for years, and one became a morbidly obese hikkikomori and retreated from public life. I know because his dad bitches about him to my aunt everyday.

My friend is now well established in a multinational, owns a HDB under his own name and even has a Japanese girlfriend. 

Sometimes like is a Euro Game, when you reach your 40s, you have to make a number of rerolls and some who were on top may find themselves at the bottom. I'm still in my 40s, and I'm worried that my next reroll would not be too far around the corner.

I hope that my pal's story will encourage you to listen to Karl Marx a little less and tune into Ayn Rand a little bit more.

Structure may be truth, but it's a losers game to put too much emphasis on it.

You have the agency to make a difference in your life. 


Monday, April 11, 2022

If Singapore women can freeze their eggs, what do we guys get ?

First of all, I just want to say that I'm in support of new initiatives for Singapore women. The execution was a little iffy because when it comes from reproduction, it is inevitable that men will be affected by the changes but this has been swept under the carpet as it is framed as primarily a women's issue.

But it's not. I think talking about this issue from men's perspective is politically incorrect, but it's not wrong.

If you think deeper. The impact of these policies on men, especially single men in the future, can be quite deep.

Basically, young women now have a choice - they can start families when their biological clock is ready, or they can freeze their eggs and start a family later after gaining some headway in their career. This will not see small-scale adoption here - I predict that corporations and multinationals will want to encourage female executives to do this and will respond with initiatives to enable generational adoption that will make egg freezing a social norm.

Where does this leave young men? For one thing, the pool of marriageable women will shrink with women in their 20-30s leaving the marriage and breeding pool. Men won't complain about this, as they can just spend more time making money to build up their own value as a mate. But there will be some men straddling the borderline of marriage eligibility who will lose out more in starting families and they will need to hold to a higher standard - freezing and preserving eggs cost money - this raises the bar for single men in Singapore.

Furthermore, even if a women is reproduction-ready in 40 thanks to modern science, we 're not too sure how susceptible single men, who are by then quite well endowed financially, will be attracted to them. If I'm a financially independent guy in the future in my 40s, I will do what Mother Nature programmed me to do - find someone in her mid-20s. So I find the argument that women who want to freeze their eggs because they can't find a Mr. Right flawed. If you can't find a guy in your 20s, what makes you able to find a guy in your 40s?

I think policymakers, in enabling egg freezing, should in another forum, recognise the difficulties of being single men. Yes, there is the Patriarchy and all that, but men are still going to be judged as a mate based on how strong they are as providers. Just because you let women freeze their eggs, they will not suddenly go after that soft-effete caring empathic beta male overnight.  A lot of borderline eligible men will join my constituency as BBFA incels. 

One idea I propose is to speed up and streamline the process for single Singaporean men to find foreign spouses and widen the pool of marriage ready women in their 20s for Singaporean men who emerge from the corporate rat race in their mid-30s. There is a serious bureaucratic snarl with some wives getting social visit passes because their husbands are discriminated based on their educational qualifications. I say we grant them citizenship once they produce Singaporean babies.

As a society we really need more babies, no matter where they come from. So if I start a political party for BBFAs, my party battle-cry in the light of egg freezing for women would be :

Every Sperm is a Good Sperm!





Sunday, April 03, 2022

Shitting my way though life... A story of my food poisoning.


Last Friday, I ate some watermelon from the fridge and ended up getting diarrhoea and vomiting simultaneously that evening. Making matters worse, I has a class to conduct the next day as it was the first batch of students of the Cryptocurrency for Conservative Investors course which means that failure was not an option.

The last time I suffered such a nasty bout of stomach flu was when I was a trainee at law firm and it was the pivotal event that made me decide to quit legal practice because I felt aggrieved at the way some individuals treated me after missing one day of a critical hearing even though I got back to work before I fully recovered. Of course, as a trainee, SMU's reputation was in my hands, not to mention that if I acted dishonourably it would tar future mid-career types, so I sucked it all in and basically did everything I could until my last day, then I ran and never turned back. 

Today, hundreds of associates leave the legal practice. Many are even getting into the Cryptospace. 

So stomach flu is no joke. It can end careers. But if you think about it, there's a lot more at stake as a trainer due to the amount of money involved and the sheer amount of work my partners have done to make running the programme possible. 

So I practically shat my way through the course, running to the toilet to do a number 2 during the plenty of breaks I built into the schedule. ( Tea breaks in course is 5 mins ! )

I'm just lucky that it was not a face to face session. 

So on Saturday, I completed the first run of the course.

I was so tired and burnt out, I did not know what got into me, I tried reading a book on Quantum Economics and it was so theoretical and mind-boggling, but thanks to legal training, and running the program while on the runs, I forced myself to finish the book and was even more dissatisfied. Sadly, I don't think I can review the book at all on this blog.

Then I was feeling so horrible after reading so much crap, I went to look at my stash of unread books and I saw what I had in my room. 

It's just nothing but a sea of books on Finance and Economics. 

This is a different kind of diarrhoea. I have this shitload of economics books. 

I never majored in Economics but now I am familiar with their ridiculous Physics envy and guilt over the damage capitalism has done to the environment and not to mention the amount of self-loathing over inequality. 

That's all I have for you guys this weekend. 

For something more useful and substantive, sign up for my next free community event where I talk about investment and the crypto space.

You can register for the event here :


Friday, April 01, 2022

ERM-CCI Community Event for Q1 2022

Apologies as I've not been updating this blog, there have been quite a few article ideas but they've been translated to content on Dr. Wealth's blog and I've also decided to turn a book review into a full-scale presentation this coming Thursday evening.

On 7th April at 730pm, I will be conducting a short session to discuss some ideas in financial planning and update community members with the latest developments in cryptocurrency. This will be the first community session where I would have completed training my first batch of Cryptocurrency investing students.

I would have wanted to review Die Broke by Stephen Pollan as it was a classic and influenced some of my D&D gaming buddies in the 1990s. Sadly, as I was in my 20s and largely ignored their financial advice. It took me over 20 years to catch up on this important classic and it shows what the markets were like over two decades ago. I think there is value in shedding light on the Die Broke Philosophy and adapting it for use in Singapore, it's a refreshing change from FIRE. 

You can register for the event here :

The content is as follows :

Di  Die Broke – Rebooting an old personal finance classic
o How 1997 was like in personal finance.
o How to adapt old ideas to new markets. 
How to deal with lower yields as protocols begin to reduce them
o Coping with lower yields.
o Opportunities in liquidity mining
ERM Portfolio Update

Tuesday, March 22, 2022

Blog taking a short break !

This is a critical period for my business as I launch my Cryptocurrency for Conservative Investors programme this Saturday, so I'm not exactly in a state to write an article. 

The nervousness of doing something totally new and the risks are also starting to get me right now. Crypto is highly dynamic and I was frazzled trying to decide whether to incorporate changes when a better approach comes by. 

I should be more relaxed next week so I'll see you then.

( Picture of the latest book I'm reading, not that I really understand what the author is driving at right now. )

Sunday, March 13, 2022

Garbage IT professionals and Institutes of Continuous Learning


Recently, a highly regarded professor of Computer Science that I greatly admire commented that the Computer Science department had low cut off scores and basically had a Garbage In Garbage Out problem. IT professionals who studied just enough to get a paper qualification so did not make a consequential impact on the industry.  

Actually, I would have been proud to come from a garbage faculty, but Engineering was quite decent during my time and I was AAA/B and the Dean of Engineering told me that Honours classification was generous for my batch of electrical engineers because it had students with fairly good A level grades. I understood quite deeply the tradeoff of studying Computer Science during my time. I was a Computer Science A level student and even spent time (as the dumbest guy) in the IOI Olympiad training team in NUS, but we were very concerned about our employment prospects and most of us then would not choose a Science degree over an Engineering degree 25 years ago.  

The consequence is that NUS did graduate CS grads who I felt, were a joke, the Honours class was excellent and can hold their own, but there plenty of jokers who thought coding was hard. I did two modules on Information Systems there and some CS students actually felt database programming was challenging.  The stories of girls who took CS was particularly unflattering. A pal from CS who was quite good said his grades were excellent because he basically had to tutor his girlfriend so he did every programming assignment twice. The girl even dumped him after graduation.

The NUS CS folks now have a few "outstanding" alumni. In particular, someone from their much admired Talent Development Program and Honours class is now a prominent enabler for "intelligent vaxxers" in Singapore and has had some run-ins against the law at the moment, providing hours of entertainment on the mainstream news.

 Anyway, I hope folks will not cancel this professor. Sometimes, we benefit from candid truths. Even if you do not agree with him, we should not scare elites into clamming up so that I can't read their mind. 

We should be asking ourselves what are the ramifications if the professor is right?  

In my generation, only 25% of my cohort went to a local university. Those who got into CS in the past are not the worst from my batch. These days, we happily admit 40% with the education minister trying to push it up to 50% with Institutes of Continuous learning. From this understanding, there's a lot of garbage floating around in this country if the professor is right. 

If anything, I think the professor is censuring himself because he did not share what he thinks about students from other NUS faculties or the newer universities, some with a primary Poly intake. It is not too difficult to use the Pareto principle when looking at each cohort. As economies become more specialised, volatile and knowledge-driven, 20% of the cohort contribute to 80% innovation and growth. In the future, we can end up with something more extreme, where 10% contribute to 90%.

What happens then?

The education minister has a huge problem in his hands. He thinks that we can maintain our employability with micro-credentials. 

I see some obstacles in his way :

a) HR departments will not change their practices.  

HR departments will still use the first degree as a signalling mechanism to hire staff. The best MNCs function as schools so they prefer aptitude and malleability, they can provide the training.  

The most competitive jobs will still go to the local uni grads with the best grades. Unless there is a gap in the labour market, I don't expect this to change. HR professionals are human beings, they will use a filter if only to reduce their workload.  

Personally, I do the same for stocks, I won't even look at the stock if there are no dividends. Of course, I miss out on growth, but I leave that to other investors. 

b) The top students of each degree program will grab all the best certifications

I think once folks understand that they are not built to learn stuff, the last thing they want is to learn more stuff and stay longer in school. Top students who have high morale from their academic pursuits will end up pursuing micro-credentials the most aggressively because it was a place they are used to winning in. I don't even need a resume anymore and I still pursue courses on Coursera!

The professor has already predicted what will happen. Some folks will do the minimum micro-credentials and use the paper to get a professional job. After a while, HR departments begin to flag folks with micro-credentials as garbage-in-garbage-out. 

Micro-credentials will then become the new private degree certificates.

There are a couple ways for policymakers to make Institutes of Continuous Learning work.

One approach is to cut down the intake for first degrees drastically. Down to 30% of the intake, so the industry must confront students who have ICL micro-credentials. This will reduce the stigma attached to studying in ICLs when the student can be top 31st percentile. This will be politically painful as I expect SIM, SIT, SUTD and SUSS to be shutdown or combined to form a mega-ICL. 

Another approach is for the civil service to eat their own cooking and hire ICL grads and put them on the same track as degree holders. Hiring criteria may be a basic degree or a specific microcredential. If I'm still a public servant today, I will definitely sign up for courses on balls-carrying and ring-fencing of work which is the real micro-credential we all need!

Finally, micro-credentials can be relevant if they come with a ridiculously high failure rate. The CFA, Cisco Certified Internet Expert of the 1990s, the Part A bar exam are all highly sought after because so many fail taking it. If you have enough folks in the industry who attempted it and failed it before, the credential will automatically be respected.  


Wednesday, March 09, 2022

How the Dalbar study gets abused by commissioned Financial Advisors

I had a secondary school classmate that I will call Mushroom. He was not known to have a scintillating personality and I found that he had a personal nature that was quite grasping and "kiasu" in nature. For some strange reasons, my friends in Engineering school turned out to be close to him because they did NS together and I was able to catch up with his dating life as an undergraduate in NUS. Mushroom is, after all, an old classmate. 

According to what I learnt as an undergrad in Engineering school, Mushroom had issues with dating women in spite of a decent paying job. I thought, in my arrogance then, that maybe he was boring and lacked the ability to communicate. 

A few years after work, I was flabbergasted to learn that Mushroom managed to not only find a girlfriend, he was on the way to getting married. This is a few years before I even met my wife and it definitely led me to suffer some amount of cognitive dissonance in those days.



I found out from a pal that Mushroom had a specific and powerful strategy to trap his girlfriend in his grasping appendages.

He met her in SDU and the moment he got his first date, he kept telling her that future events are a waste of time and they were going to be very unpleasant. According to my pal who provided the intelligence, he dominated so much of her time that she was unable to review other better matches in SDU which was why he ultimately won.

Commissioned Financial Advisors also find success in utilizing the Mushroom Strategy, basically covering their clients in so much shit and keeping them in the dark so that they can't achieve any financial agency on their own.

One mechanism to do this is the Dalbar study. The idea is that while low-cost ETFs may outperform actively managed unit trusts,  in practice, retail investors do not have the willpower to buy and hold to realise these gains. So according to Dalbar, the Average Equity Fund Investor underperforms the market indices. 

I would not want my daughter to be smothered by human fungi when she reaches dating age, so I'd like to share some ideas on how to disarm the Dalbar study.

a) What is the extent of this underperformance?

The most obvious answer is the question of what this gap is. According to this link. The gap is around 1.11%. So one counterargument is that even if an investor underperforms, the underperformance is lower than the difference in management fees of ILPs and unit trusts compared to ETFs.

This argument is good, but the gap changes over time and your FA may pick a study where the gap exceeds the management fee.  

b) Underperforming the index on your own does not directly mean that you have to buy from this FA. 

Mushroom will try to convince his girlfriend that the SDU outings suck and she won't get a better deal, but SDU is not the only game in town. She can visit a matchmaker or she can follow my approach by signing up for multiple language classes to find a mate. 

Similarly, robo-advisors are killing it in the markets with some quasi-active portfolio plans. There are also services provided by non-commissioned FAs.  

c) Bayesian Inference can still show that you can still win in a DIY game.

The Dalbar study shows the outcomes for an average investor, but you really know where you actually stand in a population. There are possible factors to suggest that you can potentially do better such as a higher intelligence and a higher conscientiousness.

If you have a degree, you already exceed the minimum requirements to become a financial advisor. If you read investment forums, you already know more than the average person. If you are crazy enough to invest time to follow an investment talk. If you own and have read a copy of The Intelligent Investor. If you read my blog, even more so! 

All these factors may suggest that you will do well when dealing with your own investment.

If readers encounter more strategies used by FAs please share them with me and I will happily work towards debunking them. 

One of the saddest developments in the financial blogosphere is that my source of research ideas is down at the moment.