Percevale
Ho Ching has stepped down as CEO of Temasek Holdings. For over 6 years, the Prime Minister’s wife held one of Singapore’s most powerful positions.
During her reign, some losses at Temasek included:
- SGD 400 million- ABC Learning Centre, Australia
- SGD 1.4 BILLION – sale of Merril Lynch (according to Reuters). Figures from Mutual Fund facts report that Temasek paid USD48 per share and at time of sale, sold their shares at USD29. Temasek denies this.
- SGD 2 BILLION loss – Shin Corp fiasco
- Further SGD 2.4 BILLION – Shin Corp fines
Under her, Temasek’s investments in UBS (Switzerland), Citigroup, Barclays and Merrill Lynch – at an original cost of US$21.88b – have declined on by some 47 percent in value.
Paper loss of US$10.28b. Paper Loss defined: an unrealized loss on an investment calculated by subtracting the current market price from the investor’s cost.
My opinion:
Contrary to some Singaporeans, I understand that Singapore’s position in the global community makes our markets heavily dependent on international trade. A small home market also weakens the government’s ability to pump prime the national economy by providing cash incentives and rebates to boost consumer spending.
If I recall correctly, local consumer spending only contributes 40% to Singapore’s economy (the average worldwide is around 50-55%).
What this means is that our economy depends on how well our friends do internationally. Many have bayed for blood at the losses incurred buying into banks like Citigroup but if you think about credit markets and cash flow- banks like UBS, Merrill Lynch and Citigroup provide credit to businesses and corporations across the continental United States.
Despite our size, we’re the 15th biggest trading partner to the US ergo. If Temasek didn’t act to purchase faltering US banks, stalled credit flow for US businesses might have dealt a deadly blow to Singapore’s economy.
Whether Ho Ching was looking hungrily at simply buying US bank shares for profit or out of an understanding of the need for US businesses to remain liquid in order to continue trade with Singaporean companies- we really won’t know.
I do know this- in a stroke of good fortune, our toxic Merrill Lynch shares converted to Bank of America stocks after BoA’s buyout of Merrill. And quite frankly, I’m taking it as a sign of a Higher Power (God, not LKY) simply looking out for lesser mortals in Singapore.
I look forward to the investment savvy of Temasek’s incoming CEO Charles Goodyear. Under the American’s care, BHP’s stock rose almost fourfold, outpacing the MSCI Materials Index’s 83 percent advance. Between 2003 and 2007, revenue went from $15.6 billion to $47.5 billion amid record gains in commodity prices.
Truth be told, I don’t understand how an Electrical Engineering graduate from Stanford (i don’t care how good the university is) implies financial intelligence that led Ho Ching to her meteoric rise as the head of Temasek (form your own opinions). For now, I believe we can all rest a bit easier now that someone with Mr. Goodyear’s impeccable credentials and investment wisdom is at the helm.
Madam Ho Ching, I bid you good luck and I hope for our sakes, you enjoy your retirement.
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How could you write such a thing. She grew our money ok? We would have made worse losses if not for her. She’s the best choice. We should be sad to lose such a capable lady to retirement.
It was just one BIG honest mistake!!! Let’s move on.
No worries Temasek & GIC will bounce back!
be patient for Many Goodyear(s) to come!
What to do? It happened, let’s move on
She left, but her coat-hangers are still there. hehehe
Hope Goodyear will have the goodmind to pack those coat-hangers out along with her.
From CNA: Temasek Holdings’ portfolio of investments fell 31% to S$127b as of 30 Nov last year, according to latest data revealed in Parliament.
That doesn’t even factor in the losses from 1 Dec till now.
Dear Ho Chin Supporter
“She grew our money ok? We would have made worse losses if not for her. ”
With due respect to your diehard support to Mdm. Ho Ching, I certainly like to see you can substantiate this statement of yours. How many years was her tenure in Temasek? How worse a losses that we would endure if not for her? That is really news to me. I think posters and readers here will certainly be interested if you are kind enough to shed a light or two. Thanks.
By the way, as inquisitive as always, I am curious to know whether you have followed her uncanny investment ability and made a fortune out of it since you seemed to be an avid supporter. Yes? No? You are not obliged to response to this if you feel it is too personal.
My sincere apology if this old man here sounded blunt, but I just could not fathom your aforesaid statement. Facts aare facts, I do not think the author of this article fabricated the numbers. Agree?
As for the Author of this article, I find his writings to point and purely reflect his candid view of this saga nothing disrespectful. I believe a majority still wishes her well in her future endeavor. Perhaps she is too stressed and certainly an early retirement to take care of our PM will do more good than harm.
To PERCEVAL: I fully agree with you. I think she should retire and take up gardening or something.It will definitely be cheaper for Singaporeans
Also it was not her certificate from Stanford that got her the job. It was her MARRIAGE CERTIFICATE.Every Singaporean knows that—some dare not admit it publically because their own job is at stake.
10 months was a figure that strikes me… MM Lee mentioned that we will see how Obama’s performance for recovery will be seen in 10 months time. CEO Ho Ching will step down in October. Will we bet that it will be a good timing then that Temasek’s losses will be recouped by then for a well deserved sending off party.
Based on reports from Asia News Network recently, its estimated that pre-crisis Temasek’s assets were worth US$125 billion. And Temasek has LOST an estimated 40% or US$50 billions todate.
For GIC, it was also estimated it started the crisis with S$550 billion, having now lost about $200 millions, now balanced with only $350 billions.
I am not going to look forward unless Chip Goodyear is a super A-grade foreign talent bestowed with god-send miraculous financial powers, other than printing money, to find back US$50 billions and S$200 billions. It was also mentioned in the same article that these LOSSES are about 200 % of Singapore’s GDP. Good grief.
Guess what – I wont be suprised our Mr Khaw would probably need to amend regulations for GP’s to ease them to be able to presribe sleeping pills more easily now for new patients who were once having a good time sleeping but now may be having countless sleepless nights wondering how to answer to Singaporeans.
“Despite our size, we’re the 15th biggest trading partner to the US ergo,. If Temasek didn’t act to purchase faltering US banks, stalled credit flow for US businesses might have dealt a deadly blow to Singapore’s economy.”
When did we become saviours of the world economy? Please lah. Next you will say Paulson and Bernanke forced Temasek to buy Merrill, like the way they forced BoA.
“I do know this- in a stroke of good fortune, our toxic Merril Lynch shares converted to Bank of America stocks after BoA’s buyout of Merril. And quite frankly, I’m taking it as a sign of a Higher Power (God, not LKY) simply looking out for lesser mortals in Singapore.”
Some consolation here. Have you checked the price of BoA recently? Do you know how much Temasek’s stake in Merrill is worth now? I can tell you from experience that losses exceeding 90% will never be recovered. Period.
Citi and BoA are zombie banks now and survive purely because of US govt life support. Any further US govt bailouts will dilute shareholders even more, if not wipe them out.
I suggest readers to check this article out instead: http://www.asiasentinel.com/index.php?option=com_content&task=view&id=1710&Itemid=233
“I look forward to the investment savvy of Temasek’s incoming CEO Charles Goodyear. Under the American’s care, BHP’s stock rose almost fourfold, outpacing the MSCI Materials Index’s 83 percent advance. ”
The author probably does’nt have a sound understanding behind the success of Charles Goodyear…
“Goodyear, a Wharton-bred former investment banker, made his reputation through an array of acquisitions in a rising metals market. He stepped down as chief executive in September 2007, but remained with the company and close to his successor Marius Kloppers when BHP launched a typical top-of-the-market US$66 billion bid for rival miner Rio Tinto, itself then trying to digest its own acquisition spree, notably aluminum giant Alcan. Only Rio’s determination to resist the takeover saved BHP from the potential disaster of such a costly acquisition and Goodyear being classified with the Wall Street crowd whose hubris and arrogance has become the biggest ever bonfire of the vanities. ”
Moreover BHP rise corresponds with a rising demand in commodity by countries such as China and India.
USS50bil and S$200bil losses! These figures are mind-boggling> Is anyone held accountable ? To even think when some MP ask for raise in allowance for those on welfare, she was told whether she wanted them to have meals at hawker centres or restaurants.
I think majority of the Singaporeans wouldn’t know about these losses ’cause the MSMs wouldn’t write about it.
Temasek’s total fund was reported in the foreign newspapers as $187 billions,
but some estimates put it at $200 billions.
Now, it is worth only $127 billions.
Therefore, the total loss is about $60 billions to $73 billions.
Our total current savings for 2007 and 2008 is estimated to be $60 billion,
(inclusive of profits from land sales.)
Total 2009 Budget is $20.5 billion.
But still requires to dip into the National Reserves for $4.5 billion.
Form your own conclusions.
http://johnharding.com/?p=429
Is Charles “Chip” Goodyear IV an impostor?
On a serious note, anyone kind enough to explain..
What is the actual cost to Temasek when our government ’sell’ Singapore’s assets like the the 3 power plants, CAAS, Singtel (1992) etc..?
If Temasek cost to these sales are just nominal $1 (which i believe could be the case), then to achieve investment return of 13-14% p.a. as reported by Mdm. Lim Hwee Hua since inception (1976) may not be reflective of actual performance at all…
Please enlighten, anyone?
15) Jeff on February 10th, 2009 11.27 pm
http://johnharding.com/?p=429
Is Charles “Chip” Goodyear IV an impostor?
Hope its not true or we singaporeans would all be fcuked up by this govt. This case is just TM alone, imagine what can happen in GIC if the truth is out.
The lost need to be highlighted and more of those who are still in dreamland needs to be awaken.
IMO, Charles should chip away the excesses of the organisation by firing all the incompetent execs & advisors to HC that led her to such a downfall.
But hang on, with their sterling performance on billion losses in TH, I bet these ppl will have tremendous obstacles in looking for a similarly well paid job and have no choice but to join the ranks of the unemployed.
Generally speaking ………………..Best age to retire at 55.
Pursue other hobbies thereafter and spend what you have accumulated !!!
Is this Goodyear fella involved in the wheat scandal that BHP got into some years back?!
Somehow I don’t have confidence that the foreign talents brought in by our papies will ever succeed in doining anything.
Please name me one …. that really contribute and not left early with a golden handshake.
So I can hope, at least.
Why there are two people with the name Charles W. Goodyear IV, a rather unusual name?
One Charles W. Goodyear IV has just been appointed to head Singapore’s sovereign wealth fund, Temasek. He was born in 1958.
The other Charles W. Goodyear IV was born in 1933.
Both Goodyears have the same parents – Charles W. Goodyear III (father), Mary E. Thompson (mother)!
More at http://www.johnharding.com
I can’t see clearly but are those the thick puppet strings behind Goodyear in the photo ?
Singapore is being forced to help with the bail out of the U.S.
Ho Ching is not alone to blame – she was pushed by the U.S. same as Abu Dhabi and Prince Al-Aweed (for Citibank).
Lee Kuan Yew answers to a higher power – the U.S. If he fails to cooperate, the U.S. will destabilize Singapore – something the U.S. is very good at – and Lee Kuan Yew will be out.
Charles W. Goodyear IV (whoever he is) has been sent by the US to control Temasek.
aiyoyo
looking at the good $ that loss,
arent those ELITEs not know that these $$$ can help a lot of people in this country?
why we have to come to this stage, which so much $$$ loss in investments???
are the ELITEs really good in investments???
aiyoyo ‘no eyes see’
John Harding,
if what you say indeed true then Obama has every right to influence the government in Singapore to be more transparent and to uphold human right value too since Singapore is so afraid of US. So let see if the government of Singapore act otherwise. Look like we can look forward to really more GoodYears
As the saying goes, behind every successful man is a woman.
Take my case. My wife just made me a millionaire within 8 months.
The only problem is – I started out as a billionaire.
;)
I learnt that there is no tolerance for loss making companies locally. Our culture was Profit orientated all the way!!!!
Now how?
Ho Ching had the best years of Singapore…she had not gone through the 2001 recession and was at the helm in boom years….of cos she oversaw some earnings. Ani low grade CEO could freaking do that. BUT when it came to the recent recession, see how she lost our money and ran away before the announcement of the losses Temasek holdings made. Good leaders show resilience and skills during tough times; she showed none and get paid hell lot for the 6 years she squandered our CPF
aiyoyo
now need to be sure can + able to get cpf $ in time at 55years old
aiyoyo
I’ll give credit for her degree at stamford, but her track record is definitely not very positive in its own aspect
Temasek will definely deny to any claims, or they will be revealing their position. That would definitely not be beneficial to them. We can only sit and speculate.
we just lost a few peanuts, why worry, without Lee K Y, do you think we have $500 B reserves ?
Ho Ching and many of our ministers graduated from Standford… just like George W Bush Jr.
What’s scary about Temasek’s loss is that it seems that it’s style of investing is just like any “man in the street”.
Just buy and if the price drops, the investments becomes “very long term”. Or worse, buy some more.
Temasek has adopted only half of Warren Buffet’s strategy. Both adopt very long term investment outlook ….. the difference is that Warren Buffet makes sure that he buys at bargain prices. Unlike Temasek – all gung-ho and plunging in when others dare not tread.
aiyoyo
“Singapore Temasek loses $39 billion in 8 months” forbes report,
not sure if those ELITEs make same or more $$$ in 8months (thru investment)?
it’s mind-boggling to read such news…
aiyoyo
aiyoyo
34) Nick on February 11th, 2009 1.36 pm
Ho Ching and many of our ministers graduated from Standford
Warren Buffett – He is a graduate of the University of Michigan Business School
is there difference between them?
aiyoyo
No university in the world can teach common sense or how to be streetsmart…
…..inherent qualities that Warren Buffett has that makes the difference,
irrespective of which university one graduates from.
Highly educated conmen are very good at packaging bullshit for public consumption….and they have evolved in the world of business and finance.
So it is imperative to have knowledge about the bad stuff besides the good stuff.
Perhaps this saga of HC and the familee should be written into some text
book lesson for all economics, business and finance students.
This should be one legacy of the famiLEE………
I wonder what will sg be like with the passing of the , I mean , time?
Global Recession is what we call living in a “MONEY TRAPPED” World
All the money$$$ is trapped and no cash to stimulate the economy!
22) John Harding on February 11th, 2009 6.35 am
Why there are two people with the name Charles W. Goodyear IV, a rather unusual name?
Scandal? at the expense of the singaporeans . . . . possible?
“Singapore Temasek loses $39 billion in 8 months” forbes report
Funny thing, the person who is responsible for the losses just walks out of the company like nobody business, and the story continues . . . . .and husband and wife live happily ever after!!!!!
To article writer, Percevale:
You should have checked your facts.
Temasek did NOT buy into Citi or UBS – GIC bought into these two.
Temasek total loss for ABC Learning of Australia was $400+ Australian Dollars, not Sing $.
From what I understand, Temasek did NOT sell Merrill Lynch shares for US$29 – the paper LOSS, based on ML’s lowest price as reflected in Bank of America share price is over US$5 billion.
As for what is quoted from your piece as follows:
“What this means is that our economy depends on how well our friends do internationally. Many have bayed for blood at the losses incurred buying into banks like Citigroup but if you think about credit markets and cash flow- banks like UBS, Merrill Lynch and Citigroup provide credit to businesses and corporations across the continental United States.
Despite our size, we’re the 15th biggest trading partner to the US ergo. If Temasek didn’t act to purchase faltering US banks, stalled credit flow for US businesses might have dealt a deadly blow to Singapore’s economy.”
That is news to me.
As I’ve said above, Temasek is NOT a shareholder of Citi or UBS & incidentally UBS is a SWISS bank, not US, altho deeply mired in US sub-prime.
Warren Buffett’s BH had over US$44 billion cash but did NOT dump into the US financial firms SINK HOLE.
The Chinese Govt holds more than a trillion US$ is US Treasuries & securities of Fannie & Freddie besides others…………what Temasek & GIC injection into Citi & ML is quite insignificant.
Middle East countries DON’T depend on trade to even a small % of Singapore……..so they DON’T have a big stake in the US as consumers of their oil.
To johnharding – #24.
UBS is a Swiss bank, so how is the US govt supposed pressure got to do with GIC plowing about US$10 B into the Swiss bank?
A news report from US said “merill lynch probe’s shock findings….700 staff are paid US $ 1 m bouns…..” What so surprise about this, isn’t this happening in s’pore where GIC & Temasek staff are paid million of sgd salary and bouns while losing billions in investment.
Hi No Say,
Yes I agree- I should have thoroughly fact checked. However, my premise remains the same- that investments in these giants, be they Swiss or US, keeps the wheels (however flawed) of commerce going for many businesses overseas.
At the end of it all, GIC/Temasek Holdings/PAP has earned themselves the mistrust from years of secrecy and ambiguity- My contention is that: Whatever has happened- Ho Ching is gone and we should be looking forward to better times.
As for Goodyear reaping benefits of growth in bullish years of commodities- fact of the matter is- while at the helm, BHP experienced 4x growth. I can’t say the same for Madam Prime Minister.
After this crisis is over,
people will be tempted by ‘special offers’ to go on credit or toxic products again and again.
Then the bubble will burst again.
And then people learn from hindsight.
and go on credit again and again and again.
nowadays its every 5 years. Progressed from every 10 year cycle.
each time all caught by surprise.
how to retire? how to job security?
security guard? Mc Dorner?
There was a table (source: Dealogic) which details some of the losses. It was in the FT last Saturday:
http://www.ft.com/cms/s/0/9668a008-f47f-11dd-8e76-0000779fd2ac.html?nclick_check=1
That’s why the Ggov has to come out and benchmarked their losses against the worst performing indices on the market.
I thought we always want to benchmark against best, not the worst. After all, we may the highest salaries in the world to those in office.
ST reported that Temasek’s loss of 31% last year is actually quite respectable compared to World Stock Index which dropped 46%. However it neglected to mention that in terms of absolute amount loss per investing company, Temasek’s loss is about the highest in the world.
This is because most investment companies are merely mosquito size (compared to Temasek) investing much much less than $1b.
If a person invests only $100 and lost everything then even though the loss is 100% it still does not hurt, but if a person invests $100b and lost only 10% then the loss is still very painful.
Hi Perceval #45
No offence intended
Re: 48) Anonym on February 15th, 2009 11.36 am
People should know that the ST is just trying to cover up for the fiascoes by GIC & Temasek in that article, I believe by Alvin Foo (can’t remember his Christian name).
As for Temasek it should be measured against its investments in FOREIGN financial markets – stock markets, private equity, hedge funds – of which it had sunk its money, and not its TOTAL portfolio, which included SINGAPORE companies like SINGTEL, SIA, DBS etc whose share price did NOT decline as steeply as Merrill Lynch, Barclays etc as at the end of November 2008.
People should realise/fact the fact that the ST which is better known as the STATE Times was ranked 153rd by Freedom House in its 2008 ranking.
Hi Perceval #45
No offence intended
Re: 48) Anonym on February 15th, 2009 11.36 am
People should know that the ST is just trying to cover up for the fiascoes by GIC & Temasek in that article, I believe by Alvin Foo (can’t remember his Christian name).
As for Temasek it should be measured against its investments in FOREIGN financial markets – stock markets, private equity, hedge funds – of which it had sunk its money, and not its TOTAL portfolio, which included SINGAPORE companies like SINGTEL, SIA, DBS etc whose share price did NOT decline as steeply as Merrill Lynch, Barclays etc as at the end of November 2008.
People should realise/fact the fact that the ST which is better known as the STATE Times was ranked 153rd by Freedom House in its 2008 ranking.