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More thoughts of Singapore crumbling fundamentals

I probably spoke about this in the past but just want to get something out there. This post is not about thinking and making a bet on some company. If you are prospecting individual business, this may or may not affect your business and you should frame it according to your business.

I was watching this economics video by Nancy Lazar on the improving fundamentals of a US economy that many thought is the blue print of what you should not happen in your country.

Yet usually, what was seldom spotted was the change in trend, due to the over focus on a narrative that have been talked about over and over again.

She also talked about the challenges of China. It would seem China have the problems of Singapore some time ago where the end result was a really terrible structural unemployment. Think too many are too young to remember how that feels.

In any case Singapore today have been very different. The way I look at it, I certainly don’t like the look of things. It seems that this country is model more as a hub for wealth management or financial services, and a place where MNC come to be the headquarters for managing regional initiatives.

And the employment or the service business is based off supporting that. The real estate, retail, back office operations.

The second important arm have been the civil service industry. That have always been around, and you can consider them to be the back office operations of this country.

Perhaps because I am a trained engineer, I developed this sensing that this country have gone backwards in this aspect. What will propel the country to the next stage is the next generation of the people and the majority of the next generation are pulled towards where the money is already at , and where the ‘fixed income’ or bond like kind of job is, which is the civil service.

The pool of people wanting to start the early Kian Ann, Norelco, Amtek, Trek, Armstrong, Cheung Woh, Adampak are lesser and lesser.

The infrastructure to support them is challenging. Cost of labour is expensive and rentals is challenging for folks starting off. Overseas costs are attractive only when put relatively to Singapore. Hence many of Armstrong and UMS are shifting low value part of it over.

The most damaging is perhaps not encouraging enough of these engineering innovations and seeding these businesses.

I struggle to think when an interesting IPO like those that I mentioned grip my attention. They were either nonsense financial engineering products from a certain marine based companies, Malaysian businesses that are interesting listing here, real estate investment trusts and business trusts (more financial engineering) , mining companies (not based in Singapore).

The low unemployment situation in this country may have created a very complacent mindset. I felt that the next crisis (not talking about the stock market here even though it will be affected) here would have that same structural unemployment situation.

We still depend so much on other people and perhaps buying a stake in other people will make them stay here.

But I always thought that the real value in a country is their ability to create something value add. That is how you move up your people in wages as well. Even with shitty problems, the US, China, France and Malaysia was able to do that.

The complacent mindset have created a next generation not willing to take risk but choose high wages or fixed income jobs. We are largely left with the few exceptional ones who break ranks.

As an individual in this country, I sometime thing how the end game would be in 20 years. Would a country that starts off as a manufacturer for the world, lost its edge, becomes service based actually was able to survive without manufacturing and engineering at all.

The biggest problem is the mindset of the people, seeded by parents who tends to be safety first, and a government that have little idea how to ignite the innovation bug in its people.


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Monday 6th of October 2014

We are talking about ourselves. Current generation and future generations are not doing what we should be doing. Is it true anyway? Who shall we blame? Blame the government of course. Blame the parents of those not talking risk next. Why don't we close the window and look into the mirror. I donmihaihai is not clever. Neither am I an innovator. Shall I go out and blame the government and parents? Or do something so that my future generations are not going to be like myself. Whenever I read these kind of article or post. The "I" is never there.


Sunday 5th of October 2014

You would also certainly argue that promoting raising oneself through investing encourages the next generation not to take more risk in setting up innovative businesses but to let others take that risk for you while you sit back, judge and aportion your allocations.

I find this post ironic coming from a finance blogger and an employed engineer.


Sunday 5th of October 2014

You misunderstood. Encouraging financial freedom allows folks to develop experience to use it and start businesses if they want at the second stage of their lives.

Whether its crumbling or not, putting money in the market encourages a vote towards supporting businesses that you feel is good.

As an engineer, you have to see how much of a competence you have develop, I did my fair share of risk taking on develops apps in hopes of becomes a business, I did my fair share of running through business ideas, I did my fair share of thinking what I can start technically. Unfortunately I couldn't come up with much.


Sunday 5th of October 2014

Totally agree. Unless we start to focus on developing our own cottage industry by encouraging people to set up their own business, we will forever be price takers.

But where to start? I believe we need an education reform. The education system is suitable for preparing students to be good employee, not employers. Secondly, we really need to see how we can reduce the cost of doing business in Singapore. Everyone wants to be landlord and nobody wants to do productive work and innovative work anymore. By reducing the cost of failure, perhaps we can encourage more people to try things that they have always wanted to do.

I don't know. It might be a start.


Tuesday 14th of October 2014

The key thing is that Singapore is too comfortable of a place and the citizens are getting too comfortable and the equation of life is easy to compute. You get a job, get paid a moderate-high wage and live your life fairly comfortably. Equitability is a problem. The government is getting too big and always pokes its nose into everything the moment someone complains on the forum page of ST. Let the citizens live their lives and add some ambiguity into life's equation.

This problem is something that just fixing the education system cannot fix. Schools can teach leadership, entrepreneurship, creativity and the arts but it will not encourage more people to innovate if the easy approach is there.

Singapore's pursuit of the never ending economic growth without looking at the big picture e.g. importing MNCs and FTs is going to have repercussions to locals. There has to be some measure of encouraging local innovation and leadership besides the financial incentive.


Sunday 5th of October 2014

"Everyone wants to be a landlord....." the key difference in other countries is that they went through that same issue in the past but they still have a diverse economy.

Education i felt play an important role, but the society mindset is probably harder to change.

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