Saturday, May 16, 2015

Singapore Savings Bonds is a form of wealth transfer

Singapore government is launching Singapore Savings Bonds in later half of 2015.

The government is likely to launch S$4b worth of bonds, since many people are risk averse, and nothing beats the security of keeping money with the government.

I see it as a form of wealth transfer.

Government uses the money from Singapore Savings Bonds for investment.  Even if the return is at the low end of 10%, and it pays out 2% to bond holders, there is a surplus of 8% to fund welfare, eg Pioneer Generation, workfare etc.

Meanwhile banks have to increase interest rate for both savers and borrowers.

This will lead to the increase in SIBOR, cost of living, and inflation rate. 

If the average return of Singapore Savings Bonds over 10 years is 3%, the banks will have to offer 3.5% to the savers.  The borrowers will have to borrow money at the cost of 5% or more.

Working adults have less spending money.  The savers keep the money in Singapore Saving Bonds, while those who have mortgage and car loan have to pay higher interest to the banks.

The aged ones and the poor gain from the government welfare program.   Even if they have not much money to buy Singapore Savings Bonds, they gain from the investment returns earned by the government.

I doubt the share price of the three major banks in Singapore will go up in the later part of the year.

Perhaps the shareholders will sell the shares of banks, and use the money to buy bonds that pay 4% or more.

Sunday, May 3, 2015

My horoscope reading for May

General Climate
Your Personal Number of Power for this month is 10. Use it in all your gaming combinations.
This month you’ll be governed by a feeling of optimism, and God knows you need some right now. A little too much optimism? Perhaps. It could provoke some surprising reactions from people who are swimming in pessimism. But you will have to force yourself to moderate your happiness. As for me, all I can say is "It doens't happen very often... so make the most of it!".

Love Life
While the first half of the month should bring you many opportunities to meet people and participate in celebrations, the second half will be less pleasurable... Nothing serious should happen, so don’t worry. This fortnight encourages you to be wary of... yourself! Don’t embellish things by making them seem better than they are, or mistaking your desires for facts. Keep your feet planted firmly on the ground, or you could gradually lose touch with reality. Then you'll be in for a rude awakening when it finally kicks in.  

Professional Life - Finances
Changes in your life are on the horizon. Your brain will be very active, and your quest for perfection will help you perform your work admirably. That should get you noticed by some important people in your field of work. You’ll receive a lot of positive energy from the stars, and that should lead you to attract Luck and prosperity. You already know deep down that success will soon be yours, and you fully deserve it.

You could feel a little fatigued this month, but fortunately it will only be temporary. Don’t worry about your health without a good reason, since most of your fears will be in your head. You’ll be fine, even though you may not think