The local paper ran this headline today in the ‘Me & My Money’ section.

He’s hit his goal of $1m worth of investments at the age of 26

I was really impressed until I read the sub-header

Full-time investor saw return of over 1,000% because of bull run in cryptocurrency market

My first thoughts were that his wealth is illusory and then my second thoughts were ‘ST is really getting terrible because crypto fever was at least half a year ago.”

Unfortunately, I don’t (and can’t) have access to read the entire article because it’s hidden behind a paywall but if the ST doesn’t caution that making money from a bull run is more a sign of luck than intelligence, this article may do more harm than good.

Thankfully, the crypto fever already seems to have passed so this sort of news shouldn’t attract a whole new wave of investors. Anyway, I don’t think Singapore is big enough of a market to move the crypto markets up in a meaningful way.

You have to admit that the ST running this sort of an article is like being late to the party. I would have expected this sort of an article to have come out late last year or early this year.

I normally say that if you see the local papers putting news of market crashes on the front page, then it’s time to go into the markets.


Markets in this region have been tanking and the STI has fallen below the 200-day EMA to the point that it’s about to pull the 50-day EMA below the 200-day. While this isn’t a perfectly reliable indicator in itself, this could present a good buying opportunity if this trend continues for another 6-9 months.

Anyway, if you’ve had a tough week, here are some reads to make it better.


‘Stingy’ millionaire donates S$3.35 million from S$20 million fortune to charity after his death (TODAY)

I’ve written about people like Agnes Plumb and Ronald Read. Finally, there’s an example from our local shores. Mr. Low Kum Moh was a sub-accountant who was born into a family of fishmongers. The secret to his wealth? Frugality and investing in the stock market over a long time-frame. This is pretty much the same story as the other ones I’ve featured here. The point of it all is that great fortunes can be made by people that most would consider very normal. The trick is to find a strategy that works and keep plugging away at it.

Which brings us to the second read.


In Praise of Incrementalism (Rebroadcast) (Freakonomics)

Freakonomics was the book that convinced me that economics could be interesting and that probably saved my university life.

In this episode of their podcast, they make the point that lots of progress in this world are based on incremental progress. The problem with most of us is that we tend to view great events or inventions as if they happened miraculously.

In particular, I love this example that their guest, economist David Laibson points out:

LAIBSON: One has the impression that it’s impossible to save enough for retirement — and to a certain extent, it is impossible if you start at age 50. But if you start early in life, and every year, you contribute let’s say 10 percent of your income, and maybe there’s an employer match, so now we’re up to maybe 15 percent, and you invest that savings in a diversified mutual fund, stocks and bonds, and you have low fees, and you keep going at that year in and year out, and you don’t decumulate prematurely — it’s amazing how that process produces millions of dollars of retirement savings. So it’s kind of hard to imagine how you go from what seems like a little bit of money each year to being a millionaire but that’s exactly the way it works when you work out the math.

Instead, most people often aim for that lottery ticket like buying bitcoin. Most people who do this put very little at the beginning (like a lottery ticket) and when it starts to pay out in a substantial way, they then proceed to bet the farm thinking that what has happened will go on indefinitely.

Unfortunately, this is almost always precisely the time when things start to go bad. Think of someone who bought bitcoin at $500 or $1,000. After seeing the price of bitcoin go to $10,000, they feel like a genius and proceed to place even bigger bets. Well, the bet may have paid off temporarily but look at how it’s turned out.

Which brings us to…


Bitcoin Bloodbath Nears Dot-Com Levels as Many Tokens Go to Zero (Bloomberg)

I’ve been writing about the problems with Cryptos since late last year (see here, here and here). To be honest, I’m not as pessimistic about crypto now as I was last year. Of course, there’s nothing fundamental to base my thoughts on but buyers are surely not as euphoric about cryptos as they were late last year.

I suppose the article compares the crash in cryptos to the crash in the tech sector during the dot-com era as prices in both situations have nothing fundamental to support them but I would argue that bitcoin is in a worse situation because, in case of the dot-com stocks, you could at least see if things were getting better based on a turn-around in cashflows and profits.

For bitcoin and cryptos, you have to track whatever these cryptos are meant to replace and see if those things are getting replaced at all.

Anyway, here’s the million-dollar picture from the article above.



Have a great week ahead!

boy wearing green crew neck shirt jumping from black stone on seashore

Stock photo of many happy children. Should you really have so many children if you cannot afford it? [Photo by ajay bhargav GUDURU on]

Is having children a blessing?
Is having more children always better than having less?

What if you have so many children that you depend a lot on the state to help raise your children? Should only those who can afford it have as many children as they like while those who can’t afford it be restricted to a certain number?

Those are questions that I don’t think anyone can agree on because these choices are deeply personal and yet, they can impact society at large.

Many children on a low income

Recently, Channel NewsAsia (CNA) ran a profile of the Heng family that has a total of nine members — Dad, Mom, and 7 kids from as old as 16 to as young as 3. As the article highlighted, the Dad only brings home less than S$3,000 a month while their monthly expenses come up to around S$3,000.

Because of this, the Heng family has barely enough for monthly necessities. Luxuries come from the generosity of friends and their church while they also have to apply for welfare payments to help with some of the expenses. The biggest cost seems to be non-monetary as the kids don’t seem to have much personal space and both the Dad and Mom seem drained from having to manage such a huge family.

I think it’s safe to say that to most people, they have no idea why this family would choose to have so many kids in the first place. And the Heng family is precisely the argument many people make for why the government should not provide complete welfare for citizens.

The argument goes something like this: if you provide citizens with enough for survival, they’ll take it for granted and make stupid choices like spending any surplus money they have on things like cigarettes, alcohol or other unnecessary things. Having hardworking taxpayers foot the bill for people like this is something that we should not support.

And the Heng family is not such a bad example, to begin with.

The Dad is working, albeit in a job that pays little. Presumably, this is commensurate with the skills he has so it’s not like he has a choice of being paid more. The Mom has to stop working because, otherwise, who’s going to take care of all the kids?

The Heng family is already a much more exemplary family that another family who was also receiving welfare, and yet had found the resources to pay for cigarettes and cable TV (see here).

How most people think about this

Reading profiles like these, I can understand why some people think this way. The average taxpayer probably thinks, “Hey, I’m working in a decent job. I get a salary and pay my taxes. On top of that, I make sure that I have enough to raise my kids and give my family a decent standard of living. Why should I be penalised by having my taxes pay for other people’s bad choices? If they chose to make bad choices, they should pay for it.”

How I think about this

Unfortunately, this is where I take a different stand. If it was the 20-year old me, I might have thought the same way as most people but right now, I tend to think of it this way:


The parents made some questionable choices but the children, if you believe children are the future, shouldn’t have to pay for those choices. This family is living on such a tight budget that I doubt they have any room for emergencies such as the Dad having to stop work due to injury or if one of the family members fall seriously ill and chalk up huge medical fees.

While those emergencies may be covered financially through welfare, we cannot deny that the emotional toll of such an emergency may impact the family. For example, if the Dad cannot work, then the Mom will have to take over the role of breadwinner and naturally, the older siblings will have to step up and take care of household matters. This will affect their studies and their shot at a decent future.

In short, Singapore’s form of targeted welfare may look good on paper but if we account for the needs of a complex system, it will not work. Vulnerable families such as the Heng family have fewer options when it comes to life. And with fewer options come worse decisions.

Poorer people have fewer options

Take for example this report on the exorbitant interest rates that poorer families pay for discretionary items. While it’s normal for most people to pay for items like a fridge or TV in full, poorer families don’t have this option and are forced to take up options such as hire-purchase schemes. While they may initially be able to afford these the purchase, a curveball that life throws them can easily cause the purchase to spiral into a nightmare.

Of course, this is not unique to Singapore. All over the world, poorer people have fewer options. For example, those who can’t afford college tuition take student loans to finance their college education. On paper, that sounds like a good thing — borrow money you don’t have, invest in an education so that you can get a higher paying job, pay off the loan and enjoy the returns from education.

In essence, education functions like how a business borrows to buy an asset and use the returns to the asset to pay off the loan. Unfortunately, not many people realise that not ALL businesses work out. Similarly, people with students loans can find themselves in trouble should they be unable to work and therefore be unable to repay the loans. The debt can snowball and your credit can get impaired such that it affects other areas of your life. This is especially true if the person took the loan to invest in an education that wouldn’t pay off anyway because demand for graduates in certain disciplines tends to be lower than others.

We need a broader safety net

I’m actually glad that in recent months, the conversation in Singapore has focused quite a bit on inequality in Singapore. Maybe it was Teo You Yenn’s book, or maybe it was because of the watershed general election in Malaysia that caused our own politicians to suddenly open up to the idea that inequality is a hot-button issue but no matter the cause, it’s good that people are starting to talk about it.

If we truly want to help the most disadvantaged in our community, we need to recognise that a safety net needs to be broader so that the ship doesn’t sink. Having targeted welfare is like providing patching holes in a ship’s hull. It’s more important to make sure the hull is strong rather than patch holes in the hull as and when they appear.

Of course, these are just my thoughts. Let me know what you think in the comments!

It’s that time of the week again!

Get yourself a cup of tea and get ready to get smarter before the week starts.


Social Security benefits buy 34 percent less than in 2000, study shows (CNBC)

The World Isn’t Prepared for Retirement (Bloomberg)

This week, I wrote a post which touched on financial literacy. The sad thing is that many people around the world have very little idea about things like inflation or compound interest.

Unfortunately, these are exactly the things that you need to think about once you no longer have a source of income. Many people also think that they will have a source of income until they reach the official retirement age but a downturn in the economy or changes to the industry can easily mean that a person loses his/her job during their prime working years.

To see how you stack up on the financial literacy scale, go and take the little test included in the Bloomberg article. It’s only three simple questions and frankly, I’m surprised that anyone can get it wrong.

The CNBC article highlights the problem with our CPF. CPF works wonders in terms of forced savings and compounding that sum into something much more. The problem is that once CPF starts paying out, inflation isn’t really factored in. It’s not really that different for most insurance products. Whole life plans and annuities often don’t adjust for increases in the cost of living.

Unfortunately, as the article and even the statistics in Singapore (Table A.1 in the document) show, inflation for medical costs tend to be higher than what the CPI shows us. And if you think about it, this is precisely what retirees and seniors should be concerned with.


Bull Markets & P/E Multiple Expansion (The Big Picture)

Ritholtz has a post commenting on research done by UBS. The research shows how bull markets tend to be a function of P/E multiple expansion. The takeaway is basically how bull markets are driven by (over?) optimism as investors re-rate stocks to deliver faster than expected growth.

In other words, bull markets tend to be driven by a narrative on investor confidence due to the economy doing well while bear markets get punctuated by cycles of optimism and pessimism.

Take the finding/theory with a pinch of salt though. After all, if these things were so predictable, then we’d all be rich.


Guide to Dividend Withholding Tax for Singapore Investors (Financial Horse)

Finally! Someone has come up with information on withholding tax on dividends and this clarifies things up so much. I suppose Financial Horse’s training as a lawyer helps because all the legal jargon and heaps of information just confuses me. The table that shows the tax rates for other countries helps so much as well. Useful information to know if you invest in overseas markets.


The Story Of Agnes Plumb: Dividend Millionaire (The Compound Investor)

Another unknown millionaire story. Same themes from all the others – money compounded over long periods, frugal lifestyle but the twist in this story is that she actually inherited the stock from her father and subsequently did nothing.

Nothing! She sat on her thumbs and just waited, and waited.

You may argue about the wisdom of not spending all that money but you cannot argue about the wisdom of how compounding is a powerful force. As my wife’s favourite bear said,

“Don’t underestimate the value of Doing Nothing, of just going along, listening to all the things you can’t hear, and not bothering.”

As for Plumb, she may not have spent a lot of the money on herself but she left a lot of it to charity and if you ask me, that’s a lot of good done for the world.



More money has been lost reaching for yield than at the point of a gun.” – Raymond DeVoe Jr.


So, I just watched this awesome documentary on Netflix called ‘The China Hustle‘ and it brings to mind some events that happened in our local stock markets some years back.

The China Hustle

The film is a documentary that follows how some investors in the U.S. got into the business of short-selling Chinese companies listed in the U.S. Basically, what they uncovered was that some Chinese companies listed on the U.S. stock exchanges were selling stories too good to be true.

The thing is that no investor can trust the financials for these companies because the numbers were all inflated in some way. What made things worse was that the investment banks, together with the auditors, bringing these companies to the market either didn’t or couldn’t do the due diligence on these firms but brought them to market anyway.

Stage two of the play saw the banks promote these stocks to clients and after having cashed out, the CEOs of the company in China, the banks who collected the fees for helping the companies list, and the brokers who sold investors the stock all made out nicely.

Stage three then saw the investors left holding on to stocks that were worth much less than they paid for them because the underlying business was then exposed as being worth many times less.

The film also interviews three investors who lost a lot of money from investing in those stocks and it’s quite painful to see retirees lose six-figure sums from what is essentially fraud.

I’m pretty sure the film also has its agenda and, therefore, takes that angle quite consistently so the thing to keep in mind is that not every Chinese company is going to turn out to be a fraud or that every banker out there is working against your best interest.

Getting educated about such things is one thing we can do to ensure that we don’t fall for schemes and scams that could ruin our lives.


S-Chips: The Singapore Version

Why did it bring to mind some things that happened in our local markets?

Well, first, the short-seller featured in the show who was purportedly the first one to expose a Chinese company is none other than Carson Block. Carson who? Block is the guy who runs Muddy Waters who basically wrote a damning piece on Olam way back in 2012. Of course, Olam turned out fine after Temasek took a stake in it and is definitely not in the same category as the Chinese companies featured in the show.

More importantly, Chinese companies listed in Singapore (called ‘S-chips’) have been a feature of our market for some years now and quite a few of them had their own accounting scandals brought to light after the Global Financial Crisis.*

There’s an anonymous account by someone who’s supposedly a former S-chip CEO that has been circulating on the internet since 2009 and it reads pretty much like the stories presented in ‘The China Hustle’. Go google and you’ll realise that it wasn’t just a problem confined to the U.S. or Singapore, the Australian and U.K. markets were similarly hit by such cases.

Of course, the China growth narrative has been played, some investors made money, and some lost big time.


People Never Learn

It’s crazy but if you’ve been investing the markets long enough, you’ll see certain patterns repeat over and over again.

One pattern is how speculators get FOMO and end up chasing the next growth story. In the early 2000s, it was tech, then housing. Then it was financials and China.

The last two years? It’s definitely been tech. People have been so open to putting money into technology (think crypto) that hasn’t any demonstratable proof of profitability. The venture capital space also seems to have no problems raising money and even in the publicly-traded space, which is usually where private investors find an exit for their holdings, investors have been quite happy to pay PE ratios of a few hundred for stocks like Amazon and Netflix.

When you see news like how Jeff Bezos is the richest person in the world and how Mark Zuckerberg is poised to overtake Warren Buffett in the richest people in the world standings, you know that’s where money has been flowing to.

I’m not saying that these businesses are not legitimate or that you’ll lose money investing in these companies. I’m also not saying that the stock prices of these companies are going to fall tomorrow.

What I’m saying is that when most people get too optimistic about something, that’s when I’d be careful about it.


*If you’re interested, Cynical Investor has a whole collection of posts on the troubles that S-chips have had in the past.




Photo by Pixabay on

In 2013, I wrote this piece ($100,000 before 30) that highlighted an article written in The Straits Times on how realistic it is for someone in Singapore to amass $100,000 before turning 30.

More than a few people in Singapore have already proven that $100,000 by 30 is more than possible (for example, see here). What I thought I’d explore is the possibility of that same person reaching $1,000,000 by 60.

Why 60? Because that’s slightly before the official retirement age in most countries. In fact, the official retirement age is probably going to be 67 or 70 for someone in my generation. However, most people feel that they don’t have enough money to retire on even after working for a lifetime.

I want to show that’s not true.

Of course, a million dollars will not be the same in 30 years as it is today but I think for many people, a million dollars is still a sum that seems unachievable even after a lifetime of work. We’ll also look at the scenario where purchasing power is retained.

Anyway, I want to look at the possibility of a 60-year-old obtaining $1,000,000 because  $1,000,000 for a 60-year-old is kind of the same mental block that $100,000 might be for a 30-year-old.

Starting assumptions

Using the numbers from the “$100,000 by 30” article, I’m assuming the following:

Starting sum at age 30: $122,919
Savings per year: $22,805
Years to compound: 30

The article assumed that the hypothetical person saves 50% of his/her income. For the sake of easy calculation and to be conservative, I’m going to assume that the amount of savings will not change. i.e. the hypothetical person continues to save only $22,805 per year from age 30-60.

Scenario 1: $1,000,000 by 60

Using a trusty financial calculator, I found that with the above assumptions, one only needs a rate of 1.24% p.a. to reach a million dollars by the age of 60.

1.24% per annum for the next 30 years.

Let that sink in. That is a seriously low bar to cross. As I write this, the 30-year Singapore government bond has a 2.88% yield. Assuming rates don’t change much, the latest issue of the Singapore Savings Bonds which everyone loves will also get you there if you keep your money in it for 10 years and repeat the process another two times.

Scenario 2: Retaining purchasing power

Of course, those worried about losing purchasing power to inflation will point out that $1,000,000 today is not the same as $1,000,000 thirty years later. Well, historically speaking, inflation has been roughly 2.5-3% per year. This means that our 1.24% p.a. needs to be something more like 3.74 – 4.24% p.a.

Scenario 3: Becoming an actual ‘millionaire’

In order to retain the purchasing power of a millionaire today, that rate of return needs to be higher. Assuming an inflation rate of 2.5% p.a., $1,000,000 today will be equivalent to about $2,097,567.58 in 30 years. In order to become the equivalent of a millionaire in 30 years time, our $100,000 by 30 person will need a rate of return of 5.12% p.a.

Keep Calm and Continue the Process

Of course, scenarios 2 and 3 are the goals we should be aiming for and that’s not going to be achieved with government bonds but neither is it an unrealistic rate of return. The $100,000 by 30 article assumed investing in a 60/40 stock/bond portfolio which should easily give us 5% p.a. It may not get you to scenario 3 but it won’t be far off.

My point is, for many people, being a millionaire seems like a pipe dream. It isn’t. Not in both nominal or real terms.

If you’re one of those that already hit $100,000 by 30, this post of mine is to provide some comfort to keep doing what you’ve been doing. What you’ve been doing is right, and you’ll be just fine. In fact, if you can bump up the savings rate or get higher returns, you can get there is fewer years.

Now, if you can’t even amass $100,000 before 30, then what are you waiting for?

If so, you won’t take kindly some of the points made in Exhibit A below.

I recently came across this article* aimed at complete beginners on investing and it’s just downright terrible. The sad part is that I’ve seen many people share this on social media like it’s good advice to take.

I hope you didn’t take too much of it seriously because there’s plenty that’s wrong with it and any financial blogger worth his/her salt should be able to point out what’s wrong with it.

Let’s take a look at what’s wrong with it.


Exhibit A – a community-sourced article which has gone viral


The whole article gives you four different options but doesn’t highlight the proper risks and rewards or evidence to back up its claims. In other words, it’s shit.

What Exhibit A gets right

Exhibit A starts off on the right note by asking people to invest monthly. It correctly states that for all investors, inflation is one of the things we need to beat and that by putting your money in a savings account, you won’t be able to beat inflation. In other words, people who save money in their bank account is going to see their savings buy them fewer things in the future.


What Exhibit A gets wrong or ignores

#1 DCA may not be the answer

While the article makes some attempt to tell us NOT to time the market, it’s recommended solution is to dollar-cost average (DCA) into the asset class. Where this goes wrong is that the market, on average, goes up more times than it goes down. What this means is that as your DCA into the market, you end up paying a higher price, on average, for the asset.

Now, being in cash runs the risk of losing out on returns from dividends, coupons or capital gains but DCA-ing into a higher price doesn’t strike me as particularly intelligent behaviour either. I don’t have the data so I don’t have a definite opinion on this but the risk of DCA should be pointed out instead of being hailed as an optimal solution to the problem.

#2 How do you define risk?

The article then classifies the different recommended “ways to invest” according to risk levels.

The problem is: what is ‘Risk’? Is it fluctuations in price levels? Or is it a permanent loss of capital?

Unless you define risk properly, the classification is unnecessarily arbitrary.

Investors with a long time horizon shouldn’t be worried about fluctuations in prices and be more concerned with the long-term returns from the various asset classes. In fact, studies have shown that over a sufficiently long period (such as 15-20 years), stocks have delivered only positive returns.

Of course, investors had to live with the volatility of prices going up and down but with a sufficiently long period, returns were both positive and higher than any other asset class. On the other hand, bonds returned less than inflation over the same period.

So which is riskier? Stocks or bonds?**

#3 Fees matter and funds underperform

The article also suggests that funds are riskier than the global ETF that the three robo-advisors invest in.

Why? Once again, no mention of that.

I’ll tell you why. The biggest reason is that actively-managed funds then to charge higher fees and end up failing to beat their benchmarks. Check out this statistic that from research that was published last year.

Over the last 15 years, 92.2% of large-cap funds lagged a simple S&P 500 index fund. The percentages of mid-cap and small-cap funds lagging their benchmarks were even higher: 95.4% and 93.2%, respectively.

Source: MarketWatch

Once again, no mention of this even though this was one of the recommended steps.


Exhibit A sucks

Yes, I understand that the article is for beginners but beyond telling them to save money and giving them the steps to start investing, the article doesn’t help much.

In fact, if I were to tell beginners something, it would be to understand compound interest, gets a sense of market history, and understand valuations. If you aren’t prepared to do all that, you won’t have an idea what to do when you see your portfolio fall by 30-40% or your losses (on paper) go into six-figures.

Exhibit A is that the kind of stuff that fulfils the adage of how knowing a little can do a lot of damage. Go do yourself a favour and actually read up on proper investing before you do anything.



*Not providing a link to Exhibit A because it’s rubbish that you’re better off not reading it. If you’re really interested, go google the headline.

**Astute readers will also point out that the question depends on whether you are an older person without a job and a need for income to meet daily expenses or a young person with a relatively stable income and expected extra years of life (and thus, investment horizon) of possibly 40-60 years.


I’m only a dad to my cat but my own father showed me the extent a dad would go to for his children. The best (and probably, worse) habits I developed came from observing what my dad would do and I wouldn’t have it any other way.

To all dads, Happy Father’s Day!

Now, here’s two light, but important, reads to keep you busy:



As I tell my students sometimes, “Common sense isn’t so common.”

There are things in life that are counter-intuitive and if you often fall prey to things that require counter-intuition, then perhaps the best solution is to read widely and make a list of situations that defy common sense.

Mark Manson’s post is particularly instructive on how certain situations require us to do less, NOT more, in order to achieve our desired outcome. Unfortunately, it’s a lesson that even the best and brightest often fail to understand.

Do yourself a favour and understand it.

Sometimes, less is more.


Your Risk Tolerance Is An Illusion: Wait Until You Start Losing Big Money (Financial Samurai)

It’s easy to say that you’ll remain invested even when things go south or to understand that most people can’t time the market, or that you’ll start investing in a big way when markets are down 30%.

But until you actually experience a downturn in the markets, you won’t know what you’ll actually do. I know, because I’ve also felt this way in ’08-09, 2012, and more recently, in 2015-2016.

I don’t know when or how deep the next downturn will be. All I know is I have a better process for the next time.

The post on Financial Samurai should give you some inspiration to start thinking about how you might behave during the next downturn. With that, you can start thinking about your investment process.


The chance to read a good book like this, with a cup of cheap coffee. That’s not something everyone gets to do


I finally got my hands on Teo You Yenn’s book “This is What Inequality Looks Like” and so far, it’s been a very enlightening read. In fact, the picture above shows what inequality really IS like in Singapore.

Here I am, a Chinese male Singaporean, able to read this book without having to buy it. On top of that, I am able to read this book at my leisure without having to worry about losing some wage while I’m reading the book.

Now, the only reason why I could borrow the book for free and read at my leisure is that my job allows me to. It’s a white-collar profession that depends more on my smarts than the amount of physical labour that I have to put in. And this would not have been possible if not for the fact that I am a university graduate.

Now, I’m not particularly intelligent. In fact, if not for a stroke of luck that the National University of Singapore’s Faculty of Social Science accepted me in the second year that I applied, I wouldn’t have made it there. This is also despite the not-so-trivial sums of money that my parents spent hiring tuition teachers for me when my brother and I weren’t doing so well in school.

I’m also on track to obtain a net worth or wealth that’s easily more than the average Singaporean will obtain in their lifetime. This is a testament to my strategy but it’s also a testament to the fact that I was born into a relatively privileged family. I never had to worry about there being no food on the table. Family holidays, albeit to destinations that weren’t so far off, were a norm.

This good fortune isn’t just confined to my immediate family. By virtue of my education, I managed to get a job in a government organisation that paid pretty well. It was there where I met my wife who comes from an equally privileged background. Of course, it helps that she was brought up well and while we may not be one-percenters, we are certainly not poor by any means.

In short, we were lucky to be born into the right families, we (at least my wife really did) made the best of it, and while we still need to work hard, we’ve largely benefitted from the system.

Why some get left behind by the system

Unfortunately, not everyone benefits from the system.

Teo’s book highlights how the poorest can fall through the cracks and remain there. It’s a mix of bureaucracy and policy that never really attempts to understand the people that the policy is supposed to serve.

Teo gives a good example in the book where she writes about how the Singapore government has made childcare more affordable but when you’re poor, it’s not just about having affordable childcare that matters. The low-income work in very different kinds of jobs from the average person. Those jobs may not allow them to pick up their children from childcare, or to buy the things for their children to participate in the usual activities that childcare centres organise.

And unfortunately, I see this at work too.

Occasionally, we counsel students who wish to withdraw from school, aren’t doing well in their studies, or who just have issues with attendance. Often, the story is that these students have family issues. Sometimes it’s the family finances that cause lots of tension in the family; Sometimes, the student’s mixing with the wrong crowd; Sometimes, they have issues with self-image.

Of course, not all of them struggling with their studies come from low-income families but I suspect if we were to actually do a proper survey, we will find that a disproportionately high share of them come from families with financial problems.

And I get it, what’s the point of doing well in school when there are more pressing concerns? After all, the payoff from doing well in school only come much later. Even if they don’t have pressing circumstances, these students that came through the non-traditional academic track then to already have disadvantages in English-language and mathematical ability.

We call them “less academically-inclined” but it very well could be that they are bad at their studies because they’ve been starting further behind the starting line in the same race all those years ago.

And so, what are we to do?

It’s not very much help to tell someone to run faster if they’re starting 20m behind the starting line in a 100m race. It also doesn’t help to tell someone to train harder for the same race if they have fewer resources (time, effort, money) to do so.

I have no answers

While my heart goes out to these lower-income people, I have no answers for them. It’s very hard to give people a solution when the system isn’t designed for them. The civil service has always prided itself on hiring some of the best and the brightest. And it does.

Unfortunately, if the best and the brightest comprise mostly of people who have gotten relatively ahead in life because they were born into the right circumstances, then it’s hard to imagine that these same people would be capable of designing a system that caters to the marginalised. Instead, the system is probably designed for the people just like themselves.

Now, don’t get me wrong. Teo’s book sheds some light on the marginalised in Singapore and the difficulties they face in getting help. From her narrative, it appears that this group of people have very low chances of escaping the poverty trap.

On the other hand, we have our government constantly highlighting how some of their own have come from underprivileged backgrounds, crawled up despite their circumstances and, in the eyes of modern society, made it.

Nowadays, the local newspapers also always highlight those who have overcome adversity to do relatively well at the national exams. No more highlighting of the best and brightest who had an easy life. Instead, they highlight those who have overcome the odds.

And that’s where I think we need to focus on for a start.

What’s the real story? Are most of the underprivileged more like those highlighted in Teo’s book? Or do most of them fit into the narrative described by our government and the media?

I hope Teo’s book is the match that lights a conversation on this.

close up of coins

Photo by Pixabay on


Today, a friend brought to my attention my calls on bitcoin.

To be fair, I didn’t call anything. It’s not like I had a price target on bitcoin or a specified timeframe for the collapse in prices but I did say that it was a mania and the whole damn thing was overhyped as an asset class.

When I began writing about bitcoin (see here and here) in November of last year, bitcoin was approximately US$7000. As of today, bitcoin is roughly US$6,400. In the span of just a few months, Bitcoin has reached a high of US$20,000 and fallen back to slightly less than when I started writing about it.

I don’t know if bitcoin and other cryptos will continue to fall but I’m pretty sure the naive, retail investors aren’t really in the thing any longer. The good news is that unlike the US housing market, I don’t think the institutions are levered up to their eyeballs with derivatives related to crypto. It’s too soon for another financial crisis and crypto seems unlikely to be the kind of asset class that would lead us to one.

I wrote a whole bunch of stuff on crypto which you can read as well.

If the value of a thing can vary so widely in just a few months, can you really use it as money? Can it hold value? Was the fervour speculative?

I think the answer to those questions is pretty obvious.

I’m pretty sure all the students and common folk in South Korea who put their life savings in crypto are regretting it now. They regret their folly which was fueled by greed.

It’s sad that people who obviously don’t know what they’re getting into, lose money on things like this. It’s not much different from those ‘investors’ who bought into structured products during the GFC.

Unfortunately, these things are as old as the hills. We would be wise to know the difference between investing and speculation.