http://theonlinecitizen.com/2008/12/sporeans-and-foreigners-both-paying-the-price/#comments
Free competition in the labour market, without safeguards, will continue to push down wages. With outsourcing of many types of work, the wages of the contract workers have now fallen below the subsidence level. Many family now needs two or three jobs to earn enough to survive.
Many countries solve this problem by introducing a “minimum wage”. I suggest that the minimum wage in Singapore should be SGD 10 an hour. If this wage is applied to cleaners, shop attendants and other low income jobs, there will be sufficient Singaporeans who are keen to accept these jobs - rather than remain unemployed.
We should continue to control the number of foreign workers who are allowed to take these jobs. The employer should be required to provide acceptable standard of accommodation and medical benefits to these worker. This will increase the cost of these foreign workers, and reduce the attraction of their “lower cost”, as compared to local workers. The foreign worker’s levy can continue to be levied.
If we need foreign workers to increase the pool of manpower, let us welcome them as long term immigrants. If they bring their family here, they will have to face the same high cost of living and cannot depress the wages fo local workers. This will be the subject of a separate discussion.
A minimum wage policy may mean that the customers have to pay more for these services. But, the increase may not be as large as feared. The wages of the workers is only one component of total cost. The other components are rental, profit and management salaries. I expect that, in a competitive market, these other components will fall to more reasonable levels, before the charges to the customers are raised.
Some people argued that higher wages will fo force businesses to locate to other countires. This argument does not hold water for the domestic service sector, which will be an important source of employment for the local people.
Anyway, we do not need many businesses in Singapore to create employment for foriegn and local workers who earn below the minimum wage. The large number of foriegn workers working in Singpaore at the depressed wages will create social problems that are not fully realised at this time.
I like to ask for support for a minimum wage policy in Singapore. This is social justice and fairness. It is for the long term good of our society.
Tan Kin Lian
Minimum wage should be $8 per hour
Someone told me that $10 an hour may be too high. He suggested that a minimum wage of $8 per hour may be more acceptable for a start. This gives $1,280 a month for 8 hours X $8 X 20 days = $1280. I agree.
Results of Poll
Poll, "Should a minimum wage policy be implemented in Singapore?"
Number of replies: 173
Yes: 75%
No: 18%
Not sure: 7%
Wednesday, December 10, 2008
Cheating - as defined in Penal Code of Singapore
Cheating – Whoever, by deceiving any person, fraudulently or dishonestly induces the person so deceived to deliver any property to any person, or to consent that any person shall retain any property, or intentionally induces the person so deceived to do or omit to do anything which he or she would not do or omit if he or she were not so deceived, and which act or omission causes or is likely to cause damage or harm to that person in body, mind, reputation or property, is said to "cheat". For example, A cheats if he intentionally deceives Z into a belief that A means to repay any money that Z may lend to him when A does not intend to repay it, and thereby dishonestly induces Z to lend him money. Cheating is punished with imprisonment of up to one year, or a fine, or both.
Read my article about cheating in The Online Citizen:
http://theonlinecitizen.com/2008/12/stop-cheating/#comment-39083
Read my article about cheating in The Online Citizen:
http://theonlinecitizen.com/2008/12/stop-cheating/#comment-39083
Tuesday, December 9, 2008
HK: Lehman losers eye US class action move - press
Representatives of two United States law firms are expected to arrive in Hong Kong soon to establish links with local investors of the failed Lehman-related products in a bid to launch a no-win-no-pay class action in a US court.
Democratic Party lawmaker Albert Ho said yesterday the class action, if launched, would not affect local attempts at mediation, arbitration and buybacks in court cases.
"There is no collective litigation in Hong Kong," Ho said. "Besides, investors will only have to pay the lawyers should they be compensated [because of the no- win-no-pay approach, which is outlawed in Hong Kong]."
He said another major difference was that the US class action would be against the trustees while the Hong Kong cases are against retail banks.
Democratic Party lawmaker Albert Ho said yesterday the class action, if launched, would not affect local attempts at mediation, arbitration and buybacks in court cases.
"There is no collective litigation in Hong Kong," Ho said. "Besides, investors will only have to pay the lawyers should they be compensated [because of the no- win-no-pay approach, which is outlawed in Hong Kong]."
He said another major difference was that the US class action would be against the trustees while the Hong Kong cases are against retail banks.
HK: DBS sued over investment losses
10 Dec 2008
A retired couple are suing DBS Bank alleging misrepresentation resulting in the loss of US$1.26 million in their Lehman Brothers-related investments. In a writ filed on Monday in the High Court, Stephen Tou Kwok-woon and his wife, Wong Fung-chun, allege that a bank executive failed to properly advise them about the risks involved in their 2006 and 2007 investments.
A retired couple are suing DBS Bank alleging misrepresentation resulting in the loss of US$1.26 million in their Lehman Brothers-related investments. In a writ filed on Monday in the High Court, Stephen Tou Kwok-woon and his wife, Wong Fung-chun, allege that a bank executive failed to properly advise them about the risks involved in their 2006 and 2007 investments.
SCMP:60 investors get HK$30m from banks on minibonds
http://www.pressdisplay.com/pressdisplay/showlink.aspx?bookmarkid=I7NBGPBK4P25&linkid=97fb02bf-a16e-487f-9fba-1d13bf14caec&pdaffid=8HM4kDzWViwfc7AqkYlqIQ%3d%3d
10 Dec 2008
Joyce Man
More than 60 investors in Lehman derivatives have received HK$30 million in compensation with help from the Democratic Party.
The settlements, involving 14 banks, came as a Legislative Council subcommittee that was formed to look into the saga said it would invoke its powers to call witnesses.
“ The range of compensation is very wide,” party member and district councillor Andrew Fung Waikwong said yesterday. “Some of them received full refunds and some even with the interest accrued.”
The party would not disclose the average percentage of the principals the investors received, but chairman Albert Ho Chun-yan said it was high.
Bank of China ( Hong Kong) reached 11 agreements, the largest number. DBS and Nanyang Commercial Bank followed with 10 and nine, respectively.
The other banks were Shanghai Commercial, Dah Sing, Citic Ka Wah, Wing Hang, Wing Lung, Bank of Communications, Citibank, Chong Hing, Fubon, Standard Chartered and Chiyu.
The city’s investors lost billions of dollars on minibonds guaranteed by Lehman Brothers when the US investment bank went bankrupt in September. Minibonds consist of high-risk, credit-linked derivatives marketed as a proxy investment in well-known companies.
Party member and legislator Kam Nai-wai expressed dissatisfaction that the resolved cases represented fewer than 1per cent of the total 7,000 requests – with losses totalling HK$ 4 billion – it received for help. “
Resolutions are going at a snail’s pace and the Monetary Authority is also moving at a snail’s pace,” he said.
Most of the investors were elderly, less educated, had little investment experience and had invested considerable amounts of their savings.
“The banks have told me they will also consider a compassionate factor,” Mr Kam said, citing single parents or people who needed to pay for their children’s education or family medical bills.
Mr Ho said he had no doubt the cases were resolved because the banks knew they had broken sales guidelines.
“All had regulation violations,” he said, adding that in some cases, bank representatives who were not licensed to sell the derivatives explained the investments to clients, and a licensed salesman simply signed the sales documents.
The Legco panel involved decided yesterday to call all its witnesses, as allowed by the law.
It may either compel them to give testimony or invite them on a voluntary basis.
But a legal adviser present said that if a witness declined to provide certain evidence at a subcommittee meeting open to the public, only the panel’s chairman and deputy chairman would have access to the material to decide whether the panel could examine it.
Reply Forward
10 Dec 2008
Joyce Man
More than 60 investors in Lehman derivatives have received HK$30 million in compensation with help from the Democratic Party.
The settlements, involving 14 banks, came as a Legislative Council subcommittee that was formed to look into the saga said it would invoke its powers to call witnesses.
“ The range of compensation is very wide,” party member and district councillor Andrew Fung Waikwong said yesterday. “Some of them received full refunds and some even with the interest accrued.”
The party would not disclose the average percentage of the principals the investors received, but chairman Albert Ho Chun-yan said it was high.
Bank of China ( Hong Kong) reached 11 agreements, the largest number. DBS and Nanyang Commercial Bank followed with 10 and nine, respectively.
The other banks were Shanghai Commercial, Dah Sing, Citic Ka Wah, Wing Hang, Wing Lung, Bank of Communications, Citibank, Chong Hing, Fubon, Standard Chartered and Chiyu.
The city’s investors lost billions of dollars on minibonds guaranteed by Lehman Brothers when the US investment bank went bankrupt in September. Minibonds consist of high-risk, credit-linked derivatives marketed as a proxy investment in well-known companies.
Party member and legislator Kam Nai-wai expressed dissatisfaction that the resolved cases represented fewer than 1per cent of the total 7,000 requests – with losses totalling HK$ 4 billion – it received for help. “
Resolutions are going at a snail’s pace and the Monetary Authority is also moving at a snail’s pace,” he said.
Most of the investors were elderly, less educated, had little investment experience and had invested considerable amounts of their savings.
“The banks have told me they will also consider a compassionate factor,” Mr Kam said, citing single parents or people who needed to pay for their children’s education or family medical bills.
Mr Ho said he had no doubt the cases were resolved because the banks knew they had broken sales guidelines.
“All had regulation violations,” he said, adding that in some cases, bank representatives who were not licensed to sell the derivatives explained the investments to clients, and a licensed salesman simply signed the sales documents.
The Legco panel involved decided yesterday to call all its witnesses, as allowed by the law.
It may either compel them to give testimony or invite them on a voluntary basis.
But a legal adviser present said that if a witness declined to provide certain evidence at a subcommittee meeting open to the public, only the panel’s chairman and deputy chairman would have access to the material to decide whether the panel could examine it.
Reply Forward
Mistrust of financial products
Hi Kin Lian,
Read your blog. I have thought about many of the issues in your blog for a long time and having worked as in the banking industry for 20 years, I have been long concerned about the products the banks are pushing out. As I shared, some of the products are so sophisticated and 'well-structured' that even financial professionals have difficulty telling the risks they are taking.
Here ia an example of an option product I came across 8 years ago, which on surface yields a whopping 18% interest. However, this 18% is merely the premium for writing a put option on HSBC shares that my CFO bought from his private banker. If the strike price was reached, his shares would be 'switched out'. Actually, this is when the option would be exercised. I saw the danger of such a product and even plotted a graph to show him that his upside was capped and his losses were unlimited. That kept him sweating for a few months until this option expired. Luckily for him, he got to 'milk' the 18%. I thought the financial institution was the greatest gainer and reaped him off completely!!
Reply: There are many products like this. It is quite common. The financial institution sells an option and takes the exess profit, leaving the investor to take an unlimited loss.
I have for a long time mistrusted banks and regulators to look after my welfare. Never invested in any of those structured deposits or even buy shares. I get saddened whenever I see folks who get trapped into this. Every time my mum brings home a brochure, I told her to dump it. To me, the financial system will fail one day. What are we to do? We certainly cannot put our money under our pillows and in biscuit tins. Surely, there must be more sober and honest institutions in the making that will look after the needs of ordinary people. Do you have any idea what this institution should be like? Can we implement that legally from our own capacity?
Reply: I hope that someone can set up a new institution, similar to the Central Provident Fund, that invest money honestly in the interest of the investors. It is just a low cost mutual fund, similar to an indexed fund.
P
Read your blog. I have thought about many of the issues in your blog for a long time and having worked as in the banking industry for 20 years, I have been long concerned about the products the banks are pushing out. As I shared, some of the products are so sophisticated and 'well-structured' that even financial professionals have difficulty telling the risks they are taking.
Here ia an example of an option product I came across 8 years ago, which on surface yields a whopping 18% interest. However, this 18% is merely the premium for writing a put option on HSBC shares that my CFO bought from his private banker. If the strike price was reached, his shares would be 'switched out'. Actually, this is when the option would be exercised. I saw the danger of such a product and even plotted a graph to show him that his upside was capped and his losses were unlimited. That kept him sweating for a few months until this option expired. Luckily for him, he got to 'milk' the 18%. I thought the financial institution was the greatest gainer and reaped him off completely!!
Reply: There are many products like this. It is quite common. The financial institution sells an option and takes the exess profit, leaving the investor to take an unlimited loss.
I have for a long time mistrusted banks and regulators to look after my welfare. Never invested in any of those structured deposits or even buy shares. I get saddened whenever I see folks who get trapped into this. Every time my mum brings home a brochure, I told her to dump it. To me, the financial system will fail one day. What are we to do? We certainly cannot put our money under our pillows and in biscuit tins. Surely, there must be more sober and honest institutions in the making that will look after the needs of ordinary people. Do you have any idea what this institution should be like? Can we implement that legally from our own capacity?
Reply: I hope that someone can set up a new institution, similar to the Central Provident Fund, that invest money honestly in the interest of the investors. It is just a low cost mutual fund, similar to an indexed fund.
P
Petition to Town Council - arranged by Gilbert Goh
Hi Friends
There are widespread unhappiness on the way our town councils have invested into toxic instruments. This is not helped by some wayward reporting by our authorities.
I have just posted an online petition for more transparency with regard to our town councils' investment.
http://www.petitiononline.com/tc0502/petition.html
Please support this petition for more transparency with town councils' investment so that we can participate fully together in our nation building.
Please also help to spread this online petition movement if you feel inclined to.
Regds
Gilbert Goh
There are widespread unhappiness on the way our town councils have invested into toxic instruments. This is not helped by some wayward reporting by our authorities.
I have just posted an online petition for more transparency with regard to our town councils' investment.
http://www.petitiononline.com/tc0502/petition.html
Please support this petition for more transparency with town councils' investment so that we can participate fully together in our nation building.
Please also help to spread this online petition movement if you feel inclined to.
Regds
Gilbert Goh
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