Your quoting out of context rivals the 145th ranked media. The full quote specifies that there is nothing which is 100% safe.

So are you basically saying “The Singapore Government cannot prevent natural disasters, Acts of God, or the collapse of international financial systems”?

He is saying “Do not bother me”.

Very good speech.

“Your quoting out of context rivals the 145th ranked media. The full quote specifies that there is nothing which is 100% safe.”

Sadly, not the first time this has happened on TOC. Granted, it may be a small and trivial issue, but if TOC and the non MSM is serious about being an alternative information outlet for Singaporeans, such inaccuracies cannot be tolerated.

If that is the Stand, what are Regulators and GOVERNMENT for?

The GOVERNMENTS of any COUNTRY are to ensure safety for everything from the Country, people to the properties of both the people and the country.

AND TO PROTECT EVERYTHING THEY(IT) GOVERN!!

patriot

PM Lee is right. Singaporeans do not want to be treated like children and he is making sure Singaporeans knows what they are doing. It is a free market after all. If government have to tell the citizens, that they must do this or that, then aren’t citizen like mindless zombies? Where is the freedom to decide?

When earning money, everyone keep quiet, what mis-selling? Lose money only, cry father cry mother, mis-selling and whatnots.

Every investor should be responsible for their own actions. Nobody force the investors to buy the product. Don’t understand also buy, so have to bear the risk. This Lehman problem between investors and financial institutions, so please don’t add salt and pepper into the debacle and push political agendas.

patriot (#5),

I tend to agree with warren (#6). If Singaporeans want to free themselves from the state nanny, then each must take more individual responsibility. Otherwise, it’ll only make himself or herself like a whining spoilt brat.

warren and pie kiah,

If we are absolutely sure that no mis-selling or snake oil sales tactics went on, then you guys are absolutely right.

If ah gong doesn’t understand what he is doing, he is fool to put his coffin savings at risk anyway.

The only problem here is if there was mis selling. From anecdotal evidence, it seems that many of the sales people themselves know their own product merely on a superficial level. They do a good job of spitting out a well rehearsed spiel they learnt in their 2-3 week training course and ah kong is nodding his head gleefully as he parts with his coffin money.

The government only wants to be nanny state over media, education, finance, revenue and politics.

When crisis, the government of course prefer not to be nanny state.

Anyway, nanny state and avoiding responsibilites are two different issues.

When government ask for pay increment, I thought I had Gods and Deities as government because they sound like they were responsible for everything good.

It means when Minibonds were fine, the government claims responsibility for providing prosperity, now is crisis, they claim not responsibility. My rubbish cleaner also know such tactics.

—————————————————————————————————

http://forums.hardwarezone.com.sg/showthread.php?t=2124070

MINISTER Mentor Lee Kuan Yew called for a sense of proportion yesterday, pointing out that the annual wage bill for ministers and all office holders is $46 million – or just 0.022 per cent of Singapore’s total economic output.

It was an ‘absurdity’, he said, for Singaporeans to quarrel over whether ministers collectively should be paid $10 million or $20 million more, when an economy worth $210 billion was at stake

‘The cure to all this talk is really a good dose of incompetent government,’ he said in his first comments on impending salary increases for ministers and top civil servants. ‘You get that alternative and you’ll never put Singapore together again.’

Singaporeans’ asset values would also disappear, he warned, adding that ‘your apartment will be worth a fraction of what it is, your jobs will be in peril, your security will be at risk and our women will become maids in other people’s countries’.

He said the present system of benchmarking ministers’ pay to top private sector salaries was ‘completely above board’ and allowed the Government to recruit ’some of the very best’ to lead the country

When it was put to him that people hoped for leaders who were willing to make sacrifices and who were not there for the money, he replied that these were ‘admirable sentiments’. But he added that ‘we live in the real world’.

His bottom line: if the Government could not pay competitive salaries, Singapore would not be able to compete and ‘we’re not going to live well’.

Yes, PAP should not be making decision for individuals. And government should relax the rules of engaging oppositions and protest. Since nothing is safe with no risk, then government should give elections a chance and Singaporean a chance to vote for a competent government and not just paying lip service and withdraw boundaries in the next election again. And government should not use threat tactics to achieve their political agenda. Until we see these happen, Singapore will be fully world class! Stop telling us what to do and who to vote and elect. Play FAIR!

That is really amazing of government who claim they cannot guarantee what is safe but can guarantee us more good years and proceed to raise GST, fare hike and all these stuff to increase inflation further when they are optimum of more GOOD YEARS. Hope do not forget what they say before the raise. Now, they admit they are NOT GOOD when things happen !

I was one of the 1400 persons who bought into DBS HN5 when trying to renew my fixed deposit. I don’t want to explain how we get conned but we did. So we all feel stupid. But even when banks sell to big institutions, they must explain the risks. MAS doesn’t even know they are selling these shit to the ordinary folks. So shit will get covered up unless there are civic minded citizens like Tan Kim Lian who stepped up to help instead of acting like Warren and Pai Kie 69 pushing us down, especially towards the lesser educated folks. .

ihatedbs,
will you like to explain further why you buy DBS HN5 ? Is one major reason because it is a government bank (so it should morally incapable of cheating) other than good return that you will promise ?

“So shit will get covered up unless there are civic minded citizens like Tan Kim Lian who stepped up to help instead of acting like Warren and Pai Kie 69 pushing us down, especially towards the lesser educated folks. .”

At the end of the day to buy or not to buy is your choice. If you bought without fully understanding the product then it is a weak argument to pin the blame on anyone else but yourself.

If you have evidence of mis selling then its a different story.

> No Nanny State (#9)
> Anyway, nanny state and avoiding responsibilites are two different issues.

Why are the two issues unrelated? Unhappy citizens are claiming that the government should be responsible for both success and failures. And the government is not giving people political freedom because they do not believe that people can’t live or die by their decision. And so this put us in this political deadlock. Politics aside, being responsible for one’s own actions is a basic virtue.

> ihatedbs (#12)
> unless there are civic minded citizens like Tan Kim Lian who stepped up to help instead of acting like Warren and Pai Kie 69 pushing us down, especially towards the lesser educated folks.

I’m not pushing you down, so don’t funging (typo intentional) frame me. I don’t understand the specifics in your case, so I can’t comment on you.

But we have to be fair to everyone, both buyers and sellers. I support Tan Kin Lian’s call to compensate cheated buyers on grounds of maintaining justice. But I’m against helping people across the board; all people whom have lost money in this product. Why should we compensate unethical businesses and irresponsible individuals?! These people better wake up their idea. Tan Kin Lian has long warned people about structured products but there are still people who just didn’t care.

A large part of this problem lies outside Singapore in the US, where even the smartest brains and sophisticated political system can allow this fiasco to happen. At this point, I can only guess that legal pursue won’t go far unless there is a clear-cut evidence of cheating on a case by case basis. This doesn’t soothe the emotions, but I’m afraid to say lost money are probably gone forever.

PM Lee is missing the point. Is he trying to divert our attention?

No body is asking the government to gaurenteed the outcome of investment. For example, many have suffered great lost in shares, but no one is asking for compensation.

So the issue here is that people were being misled into buying this high risk minibonds.

I would just like to ask if our PM thinks that it is not the responsibility of the MAS to ensure that the financial institutions do not mis-sell the minibonds (some more in such a scale) to the lay people?

But we have to be fair to everyone, both buyers and sellers. – Pie Kiah 69 (#15)

If there is a level playing field between sellers of investment products and retail investors in the first place…

But I’m against helping people across the board; all people whom have lost money in this product. Why should we compensate unethical businesses and irresponsible individuals?! – Pie Kiah 69 (#15)

Nobody, including Tan Kin Lian, has made any mentions that retail investors who fall under the following category should be compensated:
(a) Those who are aware of the risks
(b) Sophisticated investors

I can only guess that legal pursue won’t go far unless there is a clear-cut evidence of cheating on a case by case basis. – Pie Kiah 69 (#15)

Collective bargaining is what that empowers the retail investors to challenge financial institutions in the first place. I disagree with case-by-case basis because it is a lousy negotiation tactic that inevitably gives in to divide-and-conquer strategy adopted by the other negotiating party. Without unity, the retail investors are nothing.

> I disagree with case-by-case basis because it is a lousy negotiation tactic that inevitably gives in to divide-and-conquer strategy adopted by the other negotiating party.

I’m not advocating a case-by-case review because it favours big institutions, but because it’s more practical way for sieve out people who are misled and those who aren’t. It’s only useful to lump people who are misled together to ask to purse the matter together. If we include willing risk takers in this pool, it will only make the compensation case weaker.

I’m not advocating a case-by-case review because it favours big institutions, but because it’s more practical way for sieve out people who are misled and those who aren’t. It’s only useful to lump people who are misled together to ask to purse the matter together. – Pie Kiah 69 (#18)

Tan Kin Lian had asked the retail investors who claim to be misled to sign a statutory declaration – so that the bandwagon jumpers have legal liability on their statement. There are steps to minimise the risk of irresponsible retail investors who are aware of the investment risks to jump on Tan Kin Lian´s bandwagon.

Correction to #19:

I’m not advocating a case-by-case review because it favours big institutions, but because it’s more practical way for sieve out people who are misled and those who aren’t. It’s only useful to lump people who are misled together to ask to purse the matter together. – Pie Kiah 69 (#18)

Tan Kin Lian had asked the retail investors who claim to be misled to sign a statutory declaration – so that the bandwagon jumpers have legal liability on their statement. There are steps to minimise the participation of irresponsible retail investors who are aware of the investment risks to jump on Tan Kin Lian´s bandwagon.

It is essential to maintain collective bargaining while sieving out irresponsible investors at the same thing. You cannot do one without the other.

Sorry for taking a little digression, I would like to mention one of the major causes of this financial meltdown for people who are interested.

Back in 1999, Fannie Mae, USA largest underwriter for home mortgages, were forced, under political pressure, to let poor get home loans easier. (see “Fannie Mae Eases Credit To Aid Mortgage Lending”, New York Times, 1999).

On 20/20 hindsight, it turned out that this apparent good will has help to bloat the failing subprime-backed products that we see today. (“Pressured to Take More Risk, Fannie Reached Tipping Point”, New York Times, 2008). And this in turn hurts exactly the poor whom the government was trying to help in the first place most.

Of course, other factors (like Wall Street greed, complex financial derivatives, inadequate regulation, failure to see the complete financial situation etc) has also contributed to the crisis too.

But one lesson we can learn is to take prudent while exercising social welfare. Sweet stuff appeals to the public, but a very bitter after-taste might come later. This time we see the worst financial crisis since the Great Depression.

Correction to the last paragraph of #20:

It is essential to maintain collective bargaining while sieving out irresponsible investors at the same time. You cannot do one without the other.

Lets take a step back and try to draw a profile of the 1000 investors of the mini bonds. We may be able to draw some conclusions whether there was indeed mis-selling to the lesser educated retirees. If by chance a majority of the affected investors are indeed the older and more vulerable, then they may have a case.

Anectdotal evidence which we have personally encountered at our banks, esp the one involved, will testify to the fact that RMs are alerted whenever a largish customer appears at the tellers. Sometimes, tellers themselves partake in a bit of pre=selling. They will always try, but all they did to me was to waste my time and theirs.

No bank has challenged the following points made by petitioners

That FD holders were targeted

That their staff were trained on the contents opf the prospectus and tested on it?

If Minister say, “All in prospectus, investor shld read”, shldn’t banks hve made sales staff read prospectus and tested them on it? Fair is fair lol?

He is saying “Caveat Emptor”

For the vulnerable group’s benefit, Caveat Emptor” means “you die, because you are stupid because you got no graduate mum or dad, and therefore your business”.

is there anything he had said or done thus far worth debating over?

Not only LHL cannot guarantee what is safe, his dad also cannot guarantee you the golden era.

Not only LHL cannot guarantee what is safe, his dad also cannot guarantee you the golden era. – mom (#28)

Yet they still try to guarantee deposits that belong to foreign investors.

A for Arrow. Shoot the A-Team!

To get out of being a nanny state, we can start by asking the ministers not to pay themselves so highly. I do not like being in a nanny state either, but as long as they are paid more, they are expected to do more. I want paid international standards, not so KPO ministers.

#28,

LOL. well put.

I’m still searching for the golden period that MM says we’re in.

Unless by golden, you mean ‘golden’ for a select group of people. Then I’d like to ask a question, so when were we NOT in a ‘golden’ period.

Give me a pretty nanny to take care of my needs =)

If a company sold you a car which turns out to be a lemon, can you blame the government or LTA for it? Can you blame the car dealers? Can you claim that the car dealers are trying to cheat us?

Afterall, LTA, a governmental body, has scrutinised the safety ratings of the car, collect taxes on its import, sale and use. Shouldn’t they take part of the blame?

I feel that investors, like all car buyers enter into the purchase with eyes wide-open or at least expected to. Car sales reps, like all banks RM, are by nature of their jobs, expected to sell as much of their products, for the profit of the insitutions and their shareholders.

Do we want the government to prescribe the make and models of cars we should buy? What we can do is to band together somewhat and write about our bad experience with a certain make and model, and learn from our experience. Future buyers can also learn to seek such information as can be found in many of the motoring fan clubs.

Similarly, we should have the same for all the investment products………..learn from our mistakes…………and move on.

Nowadays … pro-PAP people like to tell others to move on …

Is this the counter insurgency team at work?

The new PAP mantra?

i think the people affected by the mini-bonds should drag out their negotiation with the banks till they get a satisfactory settlement. dun go for a low bearing fruit. bear in mind the next election is due in march 2011, so it is in the advantage of the mini-bond victims to drag the negotiation even if it streams into 2010. by 2010, i m sure the pap would want to have happy citizens, and i am sure banks will be guided accordingly to bend to pressure from public. keep it up people, and hope you guys get some justice.

That’s why MM Lee should not guarantee that graduate with graduate produce future graduate. Take note, Government is not here to guarantee 100% foolproof.

Some forummer luv to flame the govt, flame PAP. They say govt never listens, and will always block out views – ‘if u’re not with me, u’re against me…’

YET, when people express views that align with the govt out of pure logic and common sense and NOT out of partisanship, these forummer take out their swords and flame others! Why not just set a date/time/location, bring your baseball bat, hockey sticks, kitchen knives, and beat and slice each other and riot la! Dun hide in this virtual haven, hide behind nicknames, flame each other and still pretend to be civil.

Gangs in the real world are much more REAL! They dun use computer, dun know much English, dun go to forums/blogs, BUT they put their lives on the line and fight it out. Be real! Be civil or go out somewhere and punch it out for real.

Correction, Not Being Nanny State and Avoiding Reponsibilities to the extend of taiji during crisis are two different issues.

The issue of being No/Yes Nanny State should not even be considered here. Its a bad excuse to hide and bring out this Nanny State now.

Did he just admit that MAS guidelines/standards was below expectations by allowing the sale of complex products not suitable for retail market like Minibonds ???

If MAS was vigiliant enough, Minibonds would not even make it for sale to the mass market and mass investors.

Why not allow sale of firearms like US and when something happens, look for the firearms salesmen only. No control from government needed.

Its the same since both firearms and investment products destroy lives.

It is interesting to note that Straits Times has 2 headings for the same article. The article is written by Chua Chin Hon, China Bureau Chief.

1. Resolve claims fairly: PM
http://www.straitstimes.com/Breaking%2BNews/Singapore/Story/STIStory_295337.html

2. It will be handled ´fairly´
http://www.straitstimes.com/Breaking%2BNews/Singapore/Story/STIStory_295167.html?vgnmr=1

I wonder what the true purpose of the headings is for. TKL must continue to provide leadership for a united front. It is this pressure that will ensure retail investors get their rightful compensation.

Just like PM Lee, I had mentioned about reputational risk banks faced in handling the complaint cases. It is also the same risk that puts bank in a difficult position should they win the class suit if the retail investors were to pool their case together against the banks. Thinking along the line of the nash equilibrium, a class suit is most likely to result the banks to offer out-of-court settlement with reasonable compensation for every retail investor.

“YET, when people express views that align with the govt out of pure logic and common sense and NOT out of partisanship, these forummer take out their swords and flame others! Why not just set a date/time/location, bring your baseball bat, hockey sticks, kitchen knives, and beat and slice each other and riot la! Dun hide in this virtual haven, hide behind nicknames, flame each other and still pretend to be civil.”

Do you know what you are suggesting. It is smack full of hooliganism and you are chiding others for not being civil.

So if you can’t outdo others in any virtual discourse, you feel like like pulling out the stick which unwittingly shows your true type of competence that you are really capable of other than engaging in harmless discourse with others, whose views may be very much divorced from yours.

Please do not be too worked up. If it is pure logic and common sense, majority of decent Singaporeans will see through unless all this while we have wasted many years of national hard work / education on the majority of people.

I truly pity the government of Singapore sometimes. They cannot win it seems – Singaporeans want freedom to decide this and that. We then make stupid uninformed decisions like those Lehman bonds. And when bad things happen, we blame someone. Who better than the government for a lashing out eh? You – you should have prevented this from happening. You – you should have done better. You- you should have given me everything so I dont have to think, dont have to work, dont have to lift a finger to do anything to live. We grumble about the government being paternistic, but we act worse than children when bad things happen because of our ignorance, our dumbness or our pure laziness.

For crying out loud, be informed, be educated, be careful when making decisions. Think things through and if bad things happen because we make bad choices, stop passing the buck or expecting someone else to fix it. What about some responsibility on our part?

I pity MM Lee sometimes even more than I pity the government. The poor old dear slaves his whole life to try to make SIngapore work, and try to put his brains into different fields. Whenever he shares an opinion or a thought, he is sometimes bashed left, right and centre. Hey, no one is perfect – I honestly think a lesser and lazier person would be enjoying the twilight of his life at a lovely sandy beach, enjoying some peace and quiet with a glass of Chardonnay. Poor government of Singapore, give them a break lah…

Yes agreed. For those suffering from Melamine Poisoning, please find the manufacturers, importers, distributors and supermarkets to settle yourself.

People willing to sell, you willing to buy so its your own business. Who ask you never read the ingredients section properly ??

It has nothing to do with AVA, HSA, Health Ministry and the government. All the Regulatory Bodies have nothing to do with it, they do not regulate anything in times of crisis.

China government should stop interfering and help the China peasants who suffered.

Like Ho Peng Kee’s “This applies to all political parties”, This applies to all products including investment products.

pm lee says the Govt should not make decisions for individuals. That sounds great, except in reality, they decide for us, or attempt to influence our decisions when it comes to getting things aligned with their agenda.

Think CPF Life. How did the Govt justify time and again to defer withdrawal and specify how, when and in what manner YOUR money may be used?

My sister-in-law received letters inviting her to start a family. The Govt recently exhorted people to get married young, and parents to play their part to matchmake their kids. And not forgetting their repeated calls to targeted families to have more children.

And look at the General Elections and GRC. One way to interprete the Govt’s use of GRC is that they don’t trust us to be able to vote with understanding and maturity, so they help us do away with this right as much as possible.

While I agree with PM Lee in principle, unfortunately, the actions of his Govt appear to suggest that they apply this principle selectively.

Singaporeans are so pampered by the well-run PAP structure that they start to take everytime for granted and wants the best of everything. Expects the PAP to have system to check everything for them, instead of being independent and doing the legwork themselves.

Nobody force you to live in big cars, condo/landed and eat in restaurants. There are always HDB four rooms and public transport and hawker fares. Got jobs, but Singaporeans think themselves to “high-level” to take those jobs, so these jobs goes to foreigners and Singaporean complain “no jobs”.

“Dirty” jobs and long hours nobody wants. Just want a easy job, pays lots of money and short hours and 5 days week. Best throw in free medical benefits and 24 days leave. This is the Singaporean work today.

In the 80s, people in their 40s, worked 2 jobs, 6am to 11pm, works on Saturday, have 3 kids and no car and living in HDB and still raise a happy family. I know because that’s my family.

#44

You sound so docile and independent. I guess you should emigrate to a country with no government and who likes to live like a Third World citizen lol.

You can stay in the good old times of 1980s forever. You should not strive for anything, no need degree, no need to work, just go kopitiam lim kopi for good old times.

You should read what MM Lee said about the quality of his government when asking for world’s most expensive government salary before writing your crap.

You are plain exaggerating and repeating government propanganda here and using government’s favourite tactic of making the citizens feel guilty and pushing all the fault to the citizen.

Since the job scope of Singapore government is so light compare to other nations counterparts especially during crisis, why need to pay them so high for ???

Hi Pie Kiah 69;

Every Government in the Civilized World has the duty to look after the welfares and wellbeings of the Country and their Countrymen.

Freedom and choice to decide does not equal freedom to con, fleece, cheat and bully.

Peace does not mean a country does not need the Government, Police Force and Army.

Educated does not mean enlightened in everything in life, far from it. That is the reason why we need different agencies and people to function.

Thank You for the response.

patriot

“I truly pity the government of Singapore sometimes. They cannot win it seems – Singaporeans want freedom to decide this and that. We then make stupid uninformed decisions like those Lehman bonds. ”

Yes. Pity the government for selling scam product in the DBS bank own by the government. This product should not have been sold and the very reason people buy this product is because they trust that such institution of government cannot cheat people. Stop saying caveat emptor,
I doubt anyone bother to check what DBS. DBS is Development Bank of Singapore Limited.

“公司; pinyin: Xīngzhǎn Yínháng Yǒuxìan Gōngsī) is a bank incorporated in Singapore. It was previously known as The Development Bank of Singapore Limited (新加坡发展银行), before the present name was adopted in July 2003 to reflect its changing role as a regional bank.

The bank was set up in 1968 as a development financing institution led by the Singapore government. ”
http://en.wikipedia.org/wiki/Development_Bank_of_Singapore

Please stop lecturing the people and quote caveat emptor. Such a scam product shouldn’t have been in the market if MAS don’t even understand what this product is all about.

>Daniel on October 27th, 2008 4.31 pm
>Please stop lecturing the people and quote caveat emptor. Such a scam >product shouldn’t have been in the market if MAS don’t even understand what >this product is all about.

So Daniel……….what you are asking is for MAS to be a body to examine all investment products and decide for us all what we should invest in ?

S&P, Bloomberg and other bodies already have all kinds of ratings. Even INCOME is now using S&P’s rating in its advertisements. What happens if their ratings are wrong? S&P even rated Lehman’s products as triple A’s in July, then downgrade them to Junk status in August.

So what will happen if MAS does the same? Things happen, and several factors can affect investments. If MAS can do a 100% sure job, Singapore, will be very wealthy!

The fact is MAS is a body made up of people, perhaps intelligent people with excellent understanding of finance………..but so also was Lehman’s ex-CEO, Paulson, Greenspan etc.

Are we expecting too much from MAS? Do we blame MAS for our bad investments, and yet in good times, attribute our good fortunes to our own shrewdness in investing?

I feel sorry for the vulnerable investors, and in fact I hope the term would also include those with primary education and below in their 45’s when they invested. I too suffer from my miss-investments ( if there is such a word). Like all trading, investors should continue to try get as much refund as they can, while it is the perogative of the FI’s to reduce as much as they can from this fallout.

While we can find fault in others, it is also very important to see our own. In this matter I concur with Mr Tan Kin Lain, that investors do have to share part of the blame. Only when we accept this, can we move on.

“So Daniel……….what you are asking is for MAS to be a body to examine all investment products and decide for us all what we should invest in ?”

Yes, by all means. It will take a long time for MAS to approve the product but that ensure that MAS do it for the interest of citizen. Do we not know that these lax regulation because of making Singapore a financial hub where money freely flow to make GDP look good whatever. It is time we stop tolerating such nonsense from government. If they cannot do the job, they should stop lavishing themselves with million salary and quit to enter private sector. I’m sure these ministers and high-flying will have a lot of private business success given their connection with government and their “top-notch” attitude.

Even a government-bank could scam such a product and investors losing so much money because of trust of a gov-bank, what are other things government cannot do without the knowledge of the public ?

Gov should stop all these nonsense of screwing the citizen for the benefit for themselves rather than the country.

For heaven’s sake, we are not talking about informing choice or investment make up from ignorance, we are talking about mis-selling and mis-representation in a freaking government bank ! Doesn’t the government has shame at all selling scam product in its own bank that it don’t even understand ? Where is the standard of quality in government’s bank ? STOP GIVING BULL ABOUT COMMERICAL INTEREST. IT’S TIME TO STOP SCREWING THE CITIZEN. The government has a obligation to serve the people of citizen, not to screw and exploit the citizen.

“While we can find fault in others, it is also very important to see our own. In this matter I concur with Mr Tan Kin Lain, that investors do have to share part of the blame. Only when we accept this, can we move on.”

Everyone agree that investors should have to share part of the blame but Tan Kin Lain mentions that these harmful products shouldn’t even be put into market in first place. Why are MAS approving such product ? There IS NO EXCUSE MAS to shift blame and responsibility because this is the job of MAS to ensure, and if MAS cannot do the job, these people should get out of MAS and let others to do the job.

i now get the picture why pm went awol for so long.

he and his team of advisors must have studied the options on how best to get out of this wrangle. on one side are the banks and FIs while on the other side are the investors and their sympatisers. it cannot help one without offending the other.

to answer the way he did is to side-track the whole issue. he speaks of citizens who expects the state to nanny them but is this what the issue here is about?

no, the issue here is about investors that were sold a ‘low risk’ product which was backed by MAS – the brand you can trust – because it is backed by the PAP govt – another brand you can trust.

the issue is not about investors taking risks (though some do). it is about investors being told there were ‘practically no risk’.

point is, the product should not have been marketed as a low risk product. it should have been marketed with full presentation of all the risks that the purchase of such a product entailed.

is it correct therefore that the govt cannot gaurantee what is safe or not safe but what it can do is not to allow the banks and FIs to sell them in a ‘low risk or no risk’ manner.

If you care about your rights you should sue the bank starting with DBS. Class action law suit and make sure you blog about it and broadcast how useless DBS bank is.

I have no idea why is it so difficult for some to understand that if there is mis selling then it is not about whoi s responsible for the investment anymore. It is about whether there is a ‘f’raud’ here. The authorities have to step in because that is their duty to investigate. I think the US federal reserve made banks buy back their toxic assets because of misrepesentation and the banks are fined. This is under the purview of the authorities.

If you are retailer and sold something that does not do what it claims then the retailer is misrepresenting. Even if the prospetus says it is a highly risky product and the RM are trained to tell people it is well disersivfied and as safe as FD with a higher interest than don’t you think there is something wrong with the system? The banks probably don’t even care about the risk involved as long as they get their money for selling these products.

Right now who would want to buy structured products from DBS? It has also to do with the reputation of the bank and their integrity. Personally I wouldn’t trust the banks if they didn’t fully disclose the risk and put eveything in a complex prospectus. If they didn’t evaluate a product properly before selling it to consumers they have failed in their duty to act responsibly in their sale. I really don’t blam the RMs.

The gov have responisbiliity to investigate and determine if there is mis selling to restore conifidence in our banking sector. If we want to be a banking hub we must make sure people who trust their money with us is aware of the risk they are taking. Hk is quick to act and investigate. Singapore regulators should not be seen as slow to act. This doesn’t give much confidence to investors when they seem to be on the side of the bank, trying to help them reduce losses. A vibrant banking sector needs the bank and also the people to use the services.

To sobri, comment #33 and comment #48,

Selling a car is very different from selling financial products – so lets not compare.

What intrigues me is that a lot of those who got caught with these minibond issues are fixed deposits customers.

i.e. the most risk-averse customers ended up buying structured products, which are highly risky form of investments. Clearly, there is something fishy here that the authorities should check.

yes – the govt shouldnt guarantee, but what people have been asking is for the govt to show some leadership, and make sure that nothing fishy has happened.

His statement is contradictory to what the govt said by guaranteeing the deposits in Banks til 2010.

if cannot guarantee what is safe, then don’t pay yourself & yr government millions of dollar. u dare to take… get ready for shit from us if u people can’t perform….. as simple as that. if not ,resign … we can get cheap people to do.

“if cannot guarantee what is safe, then don’t pay yourself & yr government millions of dollar. u dare to take”
Exactly,

Woody always talk rot and think he above others. Why can’t his original statement reflect the sentiment of the citizen rather just talking from MAS’s point of view ?
“”that’s life, if you want good rewards, you have to take risks. Otherwise, leave your money with the CPF.”"

We should say the same for the MAS
“”that’s life, if you want good $$$, you have to take risks to study and approve product. Otherwise, leave your government job and go to private sector.”"

Why the fart we are paying so much money to run MAS when their job is just to register product but not approve product. To approve a product means one have to study and analyze the product. To register is admin work, no need for expensive clowns to do it, any Tom, Dick and Harry (Even the old fart) can do it.

Mr. Alan Greenspan, the former chairman of The United States Federal Reserve,
admitted his error of judgment during his watch for not intervening when the US banks and financial institutions were getting overboard in the fraudulent mortgage lending and keeping interest rates too low for too long. The Singapore & HongKong
fiasco of the Lehman Brothers’ structured deposit products are the result of the greedy bankers all over the world.

This clearly shows that the Central Banks around the world , Singapore’s MAS included, should share the responsibility of the economic fallout as well as the losses suffered by the purchases of the L-B’s structured products. It should be noted that the confession of the once all-mighty Alan Greenspan came about during the Congressional hearing on 24 October.

First time i hear govt in no position to do something.
Has their power diminished or just plain shirking of responsibility?

why not tell me that govt in no position to raise their own million dollar salary?

You think our self proclaimed world class leaders with their self paying $$$million salaries would bow their heads and confess to their incompetency? wait long long, just look at the way they talked and their reaction towards the citizens, as though we singapore will just disappeared on the world map without them, just you ppl watch what will happen when the old fart goes, starting from their own party. . . . not even to mention other opp parties.

can i peddle drug below your void deck ?.can i claim that i am a good n accurate fortune-teller, set up a store to collect certain fees for the service?
I DONT FORCE PEOPLES TO COME FOR MY SERVICE NOR DO I FORCE THEM TO BUY DRUG FROM ME.WHO SO EVER COME TO ME ,MUST REALIZE THAT NO ONE PUSH OR PUT A GUN ON YOUR HEAD , YOU MAKE YOUR OWN CHOICE TAKE FULL RESPONSIBILITY ON WHAT U DO……… CAN I????

“Some forummer luv to flame the govt, flame PAP. They say govt never listens, and will always block out views – ‘if u’re not with me, u’re against me…’

YET, when people express views that align with the govt out of pure logic and common sense and NOT out of partisanship, these forummer take out their swords and flame others! Why not just set a date/time/location, bring your baseball bat, hockey sticks, kitchen knives, and beat and slice each other and riot la! Dun hide in this virtual haven, hide behind nicknames, flame each other and still pretend to be civil. ”

“I truly pity the government of Singapore sometimes. They cannot win it seems – Singaporeans want freedom to decide this and that. We then make stupid uninformed decisions like those Lehman bonds. And when bad things happen, we blame someone. Who better than the government for a lashing out eh? You – you should have prevented this from happening. You – you should have done better. You- you should have given me everything so I dont have to think, dont have to work, dont have to lift a finger to do anything to live. We grumble about the government being paternistic, but we act worse than children when bad things happen because of our ignorance, our dumbness or our pure laziness.”

Granted, any of the so called anti govt posters have valid points and concerns but it’s just that the number of people who are lashing out for the sake of lashing out and being as muddle headed, if not more so than govt officials themselves are a very vocal proportion.

61) ordinaryman

i think you missed out the ‘entice’ element. many were enticed into beliveing the product was low or even no risks.

So frightfully funny! “The government should not be making decision for individuals. Individuals should have rights to decide for themselves . . . their circumstances, preferences, their needs . . . “PM. You believe such words?

Such “chui kong lumpar song” cock talk is a dime a dozen.

If only I can decide for myself what I can do with my CPF and Medisave.

Eg. I’m so sick and tired of being extorted by CPF/hospital of an admin fee of $3.75 every time I use my Medisave to pay for my consultation & drugs. It’s small change to some but it’s lots to others (it’s recurring fee every time we see a doc and need prescription done)

More important is the fact that they do not give a shit about the 22% increase of the electric/utilities tariff increase.

May be we should have another Tan Kin Lian doing a “SP 22% Tariff Increase SUCKS” demo at Hong Lim.

To prevent another heart attack, my doctor has advised me to stop listening to the craps dished out by idiots.

Fortunately it’s balanced by my “get off the chest” rants in blogs like this which is good for my damaged heart.

gemami:
“no, the issue here is about investors that were sold a ‘low risk’ product which was backed by MAS – the brand you can trust – because it is backed by the PAP govt – another brand you can trust.

the issue is not about investors taking risks (though some do). it is about investors being told there were ‘practically no risk’.

point is, the product should not have been marketed as a low risk product. it should have been marketed with full presentation of all the risks that the purchase of such a product entailed.

is it correct therefore that the govt cannot gaurantee what is safe or not safe but what it can do is not to allow the banks and FIs to sell them in a ‘low risk or no risk’ manner.”

Yes, agreed.

I feel that as long as the investors were not told by the salespeople that there is ABSOLUTELY ZERO RISK that they will lose their money, then there has been no foul play. Did the salespeople tell the ah kong that there is ABSOLUTELY ZERO RISK of his coffin money being lost? There is a huge difference between PRACTICALLY NO RISK and ABSOLUTELY NO RISK. A discerning customer would push further and ask for clarification about PRACTICALLY.

Plus, it can also be argued that sales spiel is expected to show the products in a positive light. After all, that is marketing. I doubt any of us believes all advertisements we see word for word right?

We must congratulate the TOC team. See, the sudden turn out of so many pro-Pap supporters at this forum.

Please, they can argue until the cows come home, but it is still painfully obvious that

1. MAS is sleeping on its job in handling this crisis
2. HK gahmen provides way better value for $$$ than the $in gahmen

I as a leader in a team,when i gave an instruction to my men they comply as told. Just in case ,matter screw up……who should be blame?
likewise, our goverment,the leader of singapore must take full responsible .cos, they allow such rotton product into singapore
# I make a decision ,gave an instruction(I TAKE FULL RESPONSIBLE)
#Goverment make a decision,allowed such product into singapore( GOVER. TAKE FULL RESPONSIBLE)

ordinaryman:
“# I make a decision ,gave an instruction(I TAKE FULL RESPONSIBLE)
#Goverment make a decision,allowed such product into singapore( GOVER. TAKE FULL RESPONSIBLE)”

So are you saying that you want the government to decide fully what sort of products that we are allowed to buy? That you want to govt to tell us that we cannot buy so and so product?

65) chorus

whether it’s No risk, Zero risk, practically No Risk, Absolutely No risk – they all point to the fact that this product was targeted at the greed of investors who wanted higher returns than a fixed deposit could offer.

by dishonestly playing down the risks while highlighting the gains & benefits, the banks and FIs become guilty of mis-selling.

the next line of arguement then is whether the investor believed what he heard and what was told to him, or, whether he choose to go back home and read the propectus, word for word, to see if what he had heard indeed tallied with what is written.

i am very certain that banks and FIs do not expect that majority of the investors would do such readings before investing. on the contrary, i believe the banks and FIs know that most would not bother to read and therefore the point of sale (RMs) is the key to closing such a sale.

it is here that the banks & FIs becomes guilty of dishonety and mis-selling.

“whether it’s No risk, Zero risk, practically No Risk, Absolutely No risk – they all point to the fact that this product was targeted at the greed of investors who wanted higher returns than a fixed deposit could offer.

by dishonestly playing down the risks while highlighting the gains & benefits, the banks and FIs become guilty of mis-selling.”

Practically no risk = still got small chance of risks

Absolutely no risk = 0% chance of risk; confirm won’t lose money

You used the word ‘greed’. Perhaps it was greed that clouded the better judgment of many investors who would normally have probed further and tried to garner more clarification and details before sinking their coffin money into the product.

I still maintain that techinically, if the investors were NOT told absolutely no risk, then you cannot say that they have been cheated.

“i am very certain that banks and FIs do not expect that majority of the investors would do such readings before investing. on the contrary, i believe the banks and FIs know that most would not bother to read and therefore the point of sale (RMs) is the key to closing such a sale. ”

Hmm. This is a very subjective call. We can take the moral stand that the banks knowingly exploit the investor’s ‘laziness’ to go read the prospecus and fault the banks for it, or then again, the materials are readily available and I’m sure investors were advised to consult the prospectus in detail. In this case it will not be unreasonable to say that it is quite foolhardy of the investors not to bother to read up when there is such a huge amount of money involved.

As for highlighting benefits and playing down risks, this is to be expected of ANY sort of marketing spiel. The question is where to draw the line between marketing and dishonesty.

chorus………..
If that the case , dont make decision . VERY SIMPLE…

69) chorus

- how sure are we then that investors were not told that there is Absolutely No risk?

I believe the banks know where they have erred, and MAS and our govt know that the banks have not been honest in their selling, and this is why they are now ‘doing the right thing’.

if the banks believe they have been honest to the letter, i do not think they will need to ‘do the right thing’. there is an element of guilt here which points to dishonesty or mis-selling.

Well that’s the thing isn’t it? It seems that no one knows for sure. As you said, evidence only ‘points to’ dishonesty and the presence of all the debate here only shows how murky the truth is.

Collect money very fast wor! When asked to return money, got many excuses leh.

chorus,try to think about it,……i just want to share tis wit u. take example, Casino ,itself is nothing to fear of,it the human nature that can be very very fatal.it not easy to control oneself.EVERY DOLLARS ,THE CASINO PROFIT,FIVE DOLLARS DAMAGE TO SOCEITY. This is very real. Even the gov. knew this fact.
(think carefully)if, they still insist of building one…Can i say they are irresponsible?……cos. they r the leader they make decision for the country that will affect everyone…(PLEASE THINK HARD) just a very ordinary old man..

THANKS – Prime Minister Lee Hsien Loong said: “The government is not in a position to guarantee what is safe and what is not safe.”

This has always confirmed within my heart what I have always held with 100% conviction.

It is better to trust in the LORD than to put confidence in man. Psalm 118:8 [BTW - some say this is the centre verse of the bible] PROFOUND!

The name of the LORD is a strong tower; the righteous run to it and are safe. Proverbs 18:10

6) warren on October 27th, 2008 12.41 am
7) Pie Kiah 69 on October 27th, 2008 12.51 am

So are you people saying that there is no need for CASE then?
While CASE is not a regulator, there is a need for REGULATORS to ensure FI do not malpractise. Your stand is Consumers must bear all the responsibility. On the surface you may have a point. On scrutiny, I see that your suggestions are very DANGEROUS and tend to bias more to the Businessmen. Thus, your statements are sweeping statements sadly. A real pitty.

Why do we need police?
Are people not taught to do the right thing?
People are taught to be Responsible for their Actions is it not?
So , by your same logic, why is there a need for Police?
Are you assuming a Perfect world?

Contracts are crafted by legal and contract experts. Many many experts, and refined over time. Tell me it does not protect the interest of the Company?

How long it takes to be qualified as a Lawyer? ditto , Contract specialist? ditto , Financial Expert? Are both of you aware that Consumers may not have such expertise? How about combined expertise?

Are you saying that since Consumers have to be Fully Responsible, there is ZERO fault on the part of the FI / RM / salesmen?

Another example :
Melamine intoxication – are people responsible for eating foods they TRUST are safe? Consumers bought those foods and if intoxicated, are you saying the Consumers are RESPONSIBLE as well , whether Melamine is written as an ‘ingredient’ or not?

Thus, I conclude your arguments are biased and sweeping statements neglecting the other important aspects.

SAD.

“chorus,try to think about it,……i just want to share tis wit u. take example, Casino ,itself is nothing to fear of,it the human nature that can be very very fatal.it not easy to control oneself.EVERY DOLLARS ,THE CASINO PROFIT,FIVE DOLLARS DAMAGE TO SOCEITY. This is very real. Even the gov. knew this fact.
(think carefully)if, they still insist of building one…Can i say they are irresponsible?……cos. they r the leader they make decision for the country that will affect everyone…(PLEASE THINK HARD) just a very ordinary old man..”

I too, was against the decision to go ahead with the casino. In that case, the govt weighed up the economic benefit that the casino would bring (admittedly, it will be a superb source of revenue) versus the social ills (is this the five dollars damage to society?) and chose the former.

However, this is another issue altogether. I prefer not to lump issues together. I believe that is how many people think and hence there is a common phenomenon here of ‘anything govt do also bash’…

In the case of the mis selling, my point is that it is not fair to condemn the govt and/or MAS 100%. Yes, it is easy to blame the govt for not looking out for the people and standing by while it is ‘obvious’ that there is dishonesty going on. All I wanted to say is that the ‘dishonesty’ is at best inferred and that it is the investor’s prerogative as well to be in the know about where he is investing his money. If we expect our govt to shield us from anything and everything then aren’t we contradicting our calls for more freedom and more decision making power?

#76

No one said there was ZERO fault on the salespeople/RM/whatever. I believe all warren and pie kiah meant was that it is not ALL the fault of the salespeople and that we should recognise that the investors made the CHOICE to invest and hence they should not ‘cry mother cry father’ when things go pear shaped.

As for your police analogy, correct me if I’m wrong, but I believe you are comparing the police to the MAS/govt, the criminal to the banks/RMs and the victims to the investors. How can you compare the criminals to the RMs when arguably, all they did was what all good salespeople do or try to do – extoll the virtues of the product and play down its weaknesses? In real life, the police can only make arrests if they possess a warrant and only charge people if they have sufficient evidence. You might as well call for the police to charge every company that makes advertisements trumpeting that their product is ‘the best’. How about those slimming or hair loss products? If they don’t work then sue the manufacturers?

As for melamine, another flawed analogy. In the case of food, it is okay to assume that what we put in our mouths from supermarkets etc. is safe. It would be criminal otherwise. In the case of the minibonds, it is naive to assume that there is no risk in investing in them, no?

so is my trust in this gahmen safe or not safe?

How can you compare the criminals to the RMs when arguably, all they did was what all good salespeople do or try to do – extoll the virtues of the product and play down its weaknesses? – chorus (#78)

Playing down the weakness of the investment product is mis-representation too.

It seems that this has digressed into a PAP and non-PAP support session.

On an individual perspective, one would want to ensure that all investment all safe. But realistically speaking, that would be impossible. Everything has some form of risk. Be it an investment of just crossing the street. No matter what precautions you take, we just can’t predict what will happen.

On a national perspective, for MAS to have regulations on what forms of investment is or is not allowed will totally void the concept of a free market. Which will in turn adversely affect our economy and eventually our wages and employment. This I believe is a scenario no one here, be it pro PAP or not, wished to happen. For us to lose that free market status, we would be left behind economically and financially in Asia. Especially to Hong Kong. Then where will we be?

The crux of the problems is that 10000 bank customers were involved in an investment product which went under due to Lehman’s collapse.

1. Facts were shown that a portion of this 10000 were in fact retirees with a limited educational standard. Showing that they may not have the ability to fully undrstand what is stated in the prospectus nor did the RMs who targeted them fully disclose the risks involved. That is a fact of misrepresentaion.

2. For the other portion of the 10000, these belong to the better educated, with the supposed ability to understand the prospectus and make an informed choice. But again, the RMs did not fully disclose the risk involved.

IMO, no what what actions the banks take now, they will not be able to please everyone. To be fair, its either to compensate evryone or none at all. I believe they took the option of compassion and started with the retirees first. Looking at the others later.

Again, this move will not appease those who do not fall in that category. Human being human, I do believe there are those who cannot be bothered to read through a 100 page prospectus even if they have the ability to do so. What they did rely on was the words of their RMs. Since there is chance to claim compensation, why not go for it. They might actually get something back. Its better than not trying at all.

In DBS HN5, there was a minimum amount required before you can invest. This category belonged to DBS Treasures department. Or some call it piority banking. This caters to the segment of the population who are cash rich, retirees included.

My stance has always been the sales practices of these RMs and the level of compaitibilty of the prospectus formulated to the ordinary man.

1. What MAS should do in this case, is regulate and tighten the standards of all financial sales personnel, private or bank. Ensure that such people truly posses the knowledge and understanding required before allowing them to practice. If they are allowed to sweet talk their clients with the advantages without realising and give an through explanation on the risks involved in the investment, then I’m sure another case like this would happen again.

2. These RMs are able to make easier sales due largely to the fact that they are representing the bank. A bank which is trusted as the nation’s bank. No one would believe they would be “cheated”. This does help cover the level of incompetencies of the RMs significantly. I dare to say this line has been used before by these RMs. ” Don’t you trust “name of bank”? Would the bank sell this if its not safe? Customer’s trust in the bank has been misused in such cases.

3. Prospectuses have to be made simpler for easier and complete understanding. For my example, using the english standard, I would ask if the language so limited that the prospectus can only be described with words more commonly used in a lawyer’s or financial terms? Is there absoltuely no other words that provide an easier comprehension by everyone and not just the selected few?

After SLIM 10 incident and how HSA , Health Ministry and Government deflect away their responsibilities, no food in Singapore is safe anymore. There are RISKS in everything you take.

The latest is MELAMINE and it was on our shelves only months ago.

This time is investment products.

Lesson learn is nothing is safe in Singapore. Never trust our regulatory bodies and government.

So why need them and pay them so much ??

People buy both MELAMINE products and Minibonds because of the same reason, we assume it is safe after going through the respective regulatory bodies.

Since AVA, HSA and MAS gave their stamp of approval, these regulatory bodies MUST bear some responsibilities or else their APPROVAL and AUTHORITY can henceforth be as good as toilet paper for flushing down the toilet bowl, TOTALLY WORTHLESS.

These Regulatory Bodies might as well shut down and save us some money.

donaldson
“Playing down the weakness of the investment product is mis-representation too.”

Again, it boils down to whether ah kong was told that it was a 100% sure win situation.

Fredrick,

Nice way of summing it up. Again, misrepresentation/misselling is very subjective and we all have our own moral stands on what constitutes misrepresentation, or serious enough misrepresenation.

Still, I agree that expecting MAS to regulate/nanny the market is not viable. And that if one is compensated, all should be compensated.

In HK the investors can protest, but in Sing, u protest K-court will find u $600. What a lousy country, useless leaders, know how to suck muillions, but dun know how to solve problems.

“People buy both MELAMINE products and Minibonds because of the same reason, we assume it is safe after going through the respective regulatory bodies.”

You assumed minibonds were safe? How do you define safe? Were you told it is 100% safe? That you won’t lose money unless hell freezes over?

Investments itself is a risk. Just like the stock market. Its a gamble on whether it pefroms or crash. There can never be a gurantee. For those who were truly misled by the RMs, then compensation should be in order.

For the rest, it was a chance you took and you should bear the consequences.

For these people to piggy back on those who were really misled, you are actually lengthening the time for processing the cases of the real victims.

One thing I do agree with is that hopefully these cases can be resolved without a lawsuit. Its not that we are letting the authorities walk all over us, but to prevent an outflow of financial instiutions from Singapore. To have a free market is why our financial sector expands with more foreign institutions. If there is a case of a lawsuit, it would only reflect badly on how open our market really is.

These institutions most likely will reduce their operational level here or even pull out totally for fear of being brought to court if such a case do happen again. This as I have mentioned will have an adverse effect on every single one of us.

We have to be rational in our expectations for this saga to be truly resolved.

chorus and gang singing to the tune of the banks keep emphasising the responsibility of the person who signed the contract.

I am not blaming the govt or MAS but do you think MAS should conduct a detailed investigation into any misrepresentation? If they are taking they own sweet time to address the issue they are not doing their job. That they will have to take responsbility.

secondly if the investment product was sold like a FD do you think it is a fair representation.

Thirdly can we not trust the RM in the banks to do the right thing? Do we want to have a culture where RM are treated as liars? Not their fault actually.

Fourth is it acceptable for the RM to down play the risk involved

Should RM give financial advice when they are as foggy as the invester on the mechanics of the product?

Should banks just look at credit ratings and approve a product? Or should they evaluate the product based on the fundamentals?

Why do you think some banks or countries are not affected by these kinds of product?

These are very valid regulation question they should address to prevent future abuse.

Just to add we are not asking the government to make a choice for us. We are asking for regulation to prevent misrepsentation of risk profile of structured products. Be clear of the difference. Government regulation on the types of products available does not mean that they make a choice for the individual consumers. You don’t not want fradulent schemes and pyrimid plans to be sold in the banks. That is the choice consumer is making. We want the government to make sure that non of this mis representation occurs and that there be more transparency in the selling instead of giving consumers a prospectus filled with jargon. That is the choice of the people.

Will the Cashier at NTUC tell you those JULIE ad KHONG GUAN MELAMINE-TAINTED foodstuffs are 100% safe before you buy and eat ??

Of course she will, it is her job. Whether she knows the risk is secondary because she assumes the MAS/ AVA and SUPERMARKETS/ BANKS already verify the RISKs.
MIS-SELLING

Nothing will happen until you get Kidney complications and die ??
Which is what happen now and everybody is trying to deflect away the responsibilities which is HUMAN NATURE. A sound system will flush out all the people who need to be responsible.

Who allow such products on our shelves ?? Nobody ??
AVA, HSA and MAS right ??

Then everyone should start producing tainted foodstuffs to sell on the cheap.
Which is what all th BANKS were doing.

End of argument.

i think there is a common ground for agreement that there is a degree of dishonesy, misrepresentation or mis-selling on the part of the banks and FIs.
And, I think MAS and the govt are also in agreement on this.

Now, supposing you are LHL, the PM, what would you do?

a. take the side of the investors
b. take the side of the banks and FIs
c. stand on middle ground and get both sides to sort it out between themselves.

It is clear, isnt’t it, that the govt has adopted b (the banks hold the discretion to decide who has been mis-sold) and c (each investor to fight his own case and banks to determine if there is any merit to each case).

By taking such a stand, the govt cannot but exposed itself to claims of not doing enough for the investors. Investors are calling for the govt to give a higher degree of attention to point a.

85) chorus
Still, I agree that expecting MAS to regulate/nanny the market is not viable. And that if one is compensated, all should be compensated.

I fully agree – 100%.

So I guess the problem now only lies with our own definitions on what constitute mis-selling. And I think we will never get an agreement on this even if we discuss till the cow comes home.

This is because:
a). we will have one group pointing to the written words and declaring that it is the investor’s own fault for not reading or getting a full and complete understanding of the written words, and,
b). another group who argues that the banks and FIS knowingly planned their marketing strategies with the intention to conceal the weaknesses (risks) of the product while at the same time amplifying the gains.

There will be no end to this . . . . . for this reason alone, compensation should not be for a particular group only but if one is compensated, then all should be likewise compensated – regardless . . .

MAS initial reaction to the structured products fiasco is similar to a policeman refusing to investigate even after the victim turned up at the police station severely wounded.

point is, the product should not have been marketed as a low risk product. it should have been marketed with full presentation of all the risks that the purchase of such a product entailed. – chorus (#65)

At least we agree with each other on some points. Obviously, the government is in no position to guarantee that investment products are safe, but the government is in the position to ensure that investment products are mis-represented and that retail banks do not use hard-sell tactics to effect sales.

Again, it boils down to whether ah kong was told that it was a 100% sure win situation. – chorus (#84)

Playing down the risk is just wrong, absolutely. I had worked in M&A advisory and it was my job to provide independent non-biased assessment of the acquisition target for the client. Often, the prospectus provided by the seller contains over-hyped expectation of the target´s senior management team.

My team had to conduct our own independent review of the target´s market outlook and see how it affects the valuation of the acquisition target. If there are downside, it is also our job to advise on how to mitigate risk related to the downsides.

We sometimes also have to inspect the physical assets belonging to the acquisition target with industry consultants to verify their values. For example, the balance sheet might say there are 100,000 tons of perishable goods that is worthed $200M.

However, the expiry date of the goods is not made available, so there is a possibility that these goods will expire as soon as the acquisition is completed, resulting in the write down of the target´s value.

Do you seriously expect ordinary retail investors to have sophisticated means (as I had elaborated) to ensure their investment is prudent when they have to depend on the relationship manager to make an investment decision?

While the prospectus is written in such a way to inform the retail investor to make their conduct their own investment research, the relationship managerś job is to provide investment advice and sell the investment product at the same time.

This conflict of interest is so obvious that it is far from impossible for banks to see this, yet banks still aggressively adopt this model of marketing investment products.

50) Daniel on October 27th, 2008 5.49 pm
Everyone agree that investors should have to share part of the blame but Tan Kin Lain mentions that these harmful products shouldn’t even be put into market in first place. Why are MAS approving such product ? There IS NO EXCUSE MAS to shift blame and responsibility because this is the job of MAS to ensure, and if MAS cannot do the job, these people should get out of MAS and let others to do the job.

———————-
I would agree to that, IF we can actually find someone with such an ability. The fact is, there is no such person, although perhaps Warren Buffet may come close. Standard Chartered Head could not even be sure. Even NUS Dean of Business School was burnt. All who deal in stocks are now looking at a much reduced asset. Indonesian richest man saw his asset shrunk overnight.

So can we in all fairness expect MAS to be the Oracle for investors?

54) aygee on October 27th, 2008 7.53 pm To sobri, comment #33 and comment #48,

Selling a car is very different from selling financial products – so lets not compare.

What intrigues me is that a lot of those who got caught with these minibond issues are fixed deposits customers.

————————————-
I agree with your use of the phrase ` a lot of those’, and not most. Even in the number of `a lot of those’ can we be sure that they do not have appetite to take bigger risks to get higher returns?
After all, when they invested, times are good, and FD’s interests are almost rock bottom.

If you are referring to the vulnerable group, I would totally agree with you. Here I’m talking about people who knowingly wanted higher interest through investments. They do know that what they will hear ( like from a car salesman ) will be all the good points about the product. And, like all cars, they also know that there will be some defects in all types and models.

Of course like all buyers of cars they can and should complain about the defects, and demand rectifications or compensations, but they cannot expect to get a full refund.

TKL stated that such structured products should not be put on sale in the first place. Some use Malaysia as an example, where such products are not sold. As fars as I know most Malaysians do not have much investments, if not any at all. The Muslims there invest in Islamic form of investments, which do not include such structured products.

Having said that, can we really justified a ban on such products, when even NUS Dean bought Lehman-related investments? What about the Town Council as stated in a comment in TKL’s blog? What if Lehman did not collapse and the investments were carried to full maturity?

Of course I would definitely agree if the structured products carry a clearer warning of being high-risk investments.

Correction to Post #93

point is, the product should not have been marketed as a low risk product. it should have been marketed with full presentation of all the risks that the purchase of such a product entailed. – chorus (#65)

At least we agree with each other on some points. Obviously, the government is in no position to guarantee that investment products are safe, but the government is in the position to ensure that investment products are not mis-represented, retail banks do not use hard-sell tactics to effect sales and that prospectus are written for retail investors in mind.

Revive plain English for retail investment prospectus. Forget legal English.

Given the wise words of our leeder,
I like to suggest we need somebody who can Guarantee its SAFE.

what say you?

The CPF investments should be safe I trust?

Maybe these investors are just greedy?

The government is not in a position to guarantee what is safe and what is not safe.” “nothing is 100% safe.” So our CPF money safe or not safe …anybody knows where our CPF money go to ?

haha CPF money also not safe la, used by GIC to invest elsewhere but won’t disclose. Anyway, CPF is structured so that we can’t take out one whole sum at one go, thus there’s no “run in the CPF”, gahment not worried that CPF losses will be exposed la. By 3-5 years, the losses will be recovered & everything still function as normal mah.

What the PM failed to explain are the following

a) the failure of MAS in its regulatory role in the financial, banking and stock markets just as Alan Greenspan has admitted recently on the collapse of Wall Street, sub-primes and ABCP and the whole American financial and banking systems.

b) what percentage has the government invested taxpayers’ funds/money in these public and private or quasi government financial institutions?

c) how many of these institutions’ board members are MPs or government apoiinted key players or PAP associates or next-of-kin of PAP?

d) how many of these institutions have Lee & Lee as legal advisors?

e) he hasn’t got the guts to admit the failure and/or incompetence of his A Team in these institutions in the eyes of world leaders in Beijing.

It’ll be interesting if some academics could do a research in these areas.

I wonder why PM Lee said “The government is not in a position to guarantee what is safe and what is not safe.”

Who asked the government to guarantee what is safe?

The issue is MAS failed to oversee the financial products and respective promotion materials are fairly packaged in plain English that is easy to understand and that it failed to react to mis-selling tactics used by bank staff.

Now MAS is talking about all these improvements that it is looking into. These “improvements” are actually the “shortcomings” it failed to address for quite some time.

The Function and Role of Government in any country are invariably the same, that is, Government is the Master Regulator, it keeps justice, peace and happiness for their countrymen.

No country is without Laws and Regulations as freedom tends to be badly abused by the unscrupulous in any society. High calibres and if possible the best are elected and picked to run a nation, these calibres are to be able to pre-empt whatever foreseeable contrivement and scheme. They are tasked, by nature of their appointments(parliamentary), to look into every injustice, solve them and cover every loophole arising from any incident, it is a duty they have to fulfill to the maximun. Every society is latent with frauds and felonies, the REASON FOR GOVERNMENT IN THE FIRST PLACE.

What we Singaporeans are witnessing in our country is that our parliamentarians are involved in running PRIVATISED STATE ENTERPRISES IN INVESTMENT AND BANKING(financial), ESSENTIAL GOODS AND SERVICES, HEALTHCARES, TRANSPORTATIONS, EDUCATIONAL AND EVEN FUNERAL SERVICES. Of course conflicts of interests are everywhere, an aspect of governance where all RULERS ARE DUTY BOUND TO ERADICATE AND IF NOT, ENSURE THAT THEY BE AT THE LEAST DAMAGING.

Poster Anon(#89) has succinctly described the wish and expectation of the investing public and it simply means an effective and efficient regulator. A regulator that is impartial, neutral with wisdom in dispensing justice.

Over the years, our Government has evolved into the largest, strongest and most aggressive entrepreneur within the confine of our geographical boundary. It is a giant cartel in everything edible, useable and MOST IMPORTANTLY ESSENTIAL.
Pardon me for the digression.

Food manufacturers have to ensure the safeties of their products, failing which they are liable to answer to the Laws or a regulator as an intermediator between both. A regulator, as can be seen here, is neither the manufacturer non the Laws(Government/Judiciary) so the role of a regulator is like that of the police in modern day administrations. The Police is not only to enforce Laws and Orders and to bring law breakers to justice, on top of this specific duty, the POLICE IS DOING CRIME PREVENTION.

PREVENTION OF FLAWS, FOULS AND UNDESIRABLE DEEDS(MISDEEDS) IS CLEARLY THE LEGISLATED DUTY AND FUNCTION OF ANY REGULATOR. A regulator that fails to fulfill its’ duty is liable to negligent or failure of duty, it could also be failure of diligence and competency. Here we are talking about an agency made up of professionals and not an individual with definite power and wisdom.

There are much heat, anger and coarseness in the discussions in this thread and elsewhere. May I join jemami in calling for more constructive and less personal confrontational discussions and debates.

“94) sobri on October 28th, 2008 9.33 am
Having said that, can we really justified a ban on such products, when even NUS Dean bought Lehman-related investments? What about the Town Council as stated in a comment in TKL’s blog? What if Lehman did not collapse and the investments were carried to full maturity? ”

If it is not fit for consumption (very high risk products in this context) for most people, it just means that it is not fit for consumption. If the queen wants to buy it, it just means the queen wants to buy it. Period. Do not impute more than that.

Now a lot of financial institutions in the world are now beginning or have already begun to relook into all these instruments. Perhaps, we are still adopting a wait and see attitude and just tag along at the end of the end.

“If Lehman did not collapse and the investments were carried to full maturity”, it just means that some people just got lucky without knowing that it is high risk all this while and still think that it is safe. That’s all.

Mr. PM Lee,
We also cannot guarantee whether you will get to keep your world class salary at the next elections since you cannot even bother to help your citizens but has time to attend tea party at Mercy Relief.

In the first place if MAS had conducted due diligence or had smart people from NUS like professor Yueng, these product would not have passed through the smart rigorous check. Unfortunately ,we had Harvard grad who led them through the kelong .
We ask the PM to guarantee that we don’t have such people again manning the regulatory system.Once we have this guarantee it is as good as guaranteeing that we won’t lose in structured products or products that will guarantee our loss. GIC is so smart to see the toxicity The people there saw it without the aid of glasses it.Don’t understand why they didn’t tip off MAS..
I wonder Alan Greenspan would be interested to apply his theory of non interference here? I am sure he can teach MAS one or two about non regulation of the market and let the FIs do whatever they like. Did you know Alan Greenspan was asked to helm Fed by his good friend when he was just embarking on his PhD? He was from Harvard. No wonder.

“We also cannot guarantee whether you will get to keep your world class salary at the next elections”

since when the citizen determine these gahmens’ astronomical pay, let alone guarantee their pay ? These gahmen guarantee their own pay and is their own guarantor and boss themselves. They are the one who determine their own performance rating and give themselves Hi-Five.

“attend tea party at Mercy Relief.”
Look like hip-hoping went out of fashion, now tea party is the trend !

The good thing that is coming out of this would be that more singaporeans understand that they cannot trust the government any more.

The government we have is ornamental, they can’t guarantee shit.

However, looking at all the developments, I don’t think the investors will get a fair resolution nor in good time.

I don’t think the banks will go unscathed even if they need not compensate. Consumer confidence will take a beating. Here, we are not talking about the penny savers but those with means of at least a hundred thousand.

Overall, it’s going to be a lose lose for all.

But in terms of crisis management, I think the banks could have done better. MAS shud at least look into this area?

if government cannot do this and do that, why set up so many department or create so many posts?

just close down mas and sack the staffs.

just have ministry of finance can already.

Given what is said, I think only the investors themselves, oh i dont mean us the cpf investors, have only themselves to ‘guarantee’ themselves now.

What we have gathered so far is
1) A lot of people (including retirees) were asked to invest in these products when renewing their fixed deposits.
2) Marketing brochure did not state the full risk – but prospectus did. If the procedure is to sell investors a product based on market brochure and only give the investor a prospectus as an after thought, there is some wrong. Question I also want to ask is whether the marketing brochure states that the investor could lose everything if anyone of the 6 or 7 banks collaspe. If not, there may be an intention to hide.
3) Mis-representation of product. It is called a mini-bond but is actually more than that.

From the above, I feel there is a case against the banks for either un-ethical mis-selling or not knowing the product they are selling well enough. Due to point 3 alone, I feel all investors should be compensated. It is either a bond or not a bond. Don’t confuse and mislead.

Response from authority
1) M$MIW (million $ men in white) appoints independent parties to investigate and to work out a solution betw banks and investors. So far, banks have agreed to compensate retirees above a certain age and will investigate all cases. Maybe all will get money back, maybe only some will get money back.

Nothing wrong with that except it appears that Singapore is 1 step behind HK. Government don’t seem to be doing much until citizens protest. Bad PR.

My view
1) I agree that govenment is not in position to guarantee what is safe and not safe. We are a free market, and you are free to invest in what you like. Probably the only thing that MAS can fully control is what is considered “safe” for CPF investment. Key word is “guarantee”.
2) MAS as I understand has a policy that only sofisicate (and rich) investor can invest in hedge funds because they are complex and entails high risk that is not suitable for normal folks. I think this policy needs to be tweaked to include some of these high risk notes and bonds.
3) Regulation can be strenghtened to enure that marketing brochure for investment product must include key investment risk.
4) If it has been found that wrong selling is isolated and not wide-spread, banks should punish the errant RM. If it is widespread, MAS should punish the banks.

Whatever the case, it seems like MAS is not doing a good enough job regulating what can be sold in banks. Don’t let the problem blow up in your face before solving them. Otherwise, you will never get a grade that is above C.