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gravity_infinity Arch-Supremacy Member http://forums.fuckwarezone.com.sg/avatars/589006.gif?dateline=1370607327 Join Date: May 2013 Posts: 10,852 | wols... reminder.. Mr Teo Ho Pin says be thankful for lehman losses According to an article entitled “Dr Teo says ‘be thankful’” which was published in the TODAY newspaper on 19 Nov, Dr Teo Ho Pin, MP for Holland-Bukit Panjang, says residents should be thankful that their Constituency’s funds have grown under the Town Council’s watch. He was referring to earlier revelations in Parliament that eight PAP Town Councils have about $16 million invested in troubled structured products, of which the lion’s share of $8 million is from Holland-Bukit Panjang. Dr Teo was quoted by TODAY newspaper as saying that the potential $8 million loss suffered by Holland-Bukit Panjang Town Council “should be viewed in the context of the $24 million in investments generated over the past six years“, and that “if the Town Council had invested all its funds in low-risk investments, it would have earned only $5 million.” My opinion is that rather than giving our thanks to Dr Teo Ho Pin, who is incidentally Coordinating Chairman for all the 14 PAP Town Councils, for generating positive returns for Town Council funds over the past six years, we should instead be grateful that he has beautifully illustrated the sheer level of hubris and arrogance of the PAP. According to the Straits Times Online article “$16m risk exposure” published on 18 Nov, the $8 million that Holland-Bukit Panjang Town Council invested in Minibonds and Jubilee notes represents around 6.7 per cent of its investible funds. Hence, the total investible funds of this Town Council is currently around $119.4 million. The investment returns of $24 million that Dr Teo Ho Pin boasted about would therefore represent a net profit of only 25.2% over a six year period, which works out to an ROI of around 3.82% per annum. That kind of return is hardly worth boasting about. It is even less than interest rate paid on CPF Special Accounts, or for that matter, the coupon returns of the bonds issued by Statutory Boards like HDB and URA. Dr Teo Ho Pin said that the residents “should thank the Town Council for working hard to come up with a diversified portfolio to generate income so that residents do not have to fork out more money.” Sure, in addition to all the maintenance works required in the estate, the Town Council also pays 5% to 10% of the flat and lift upgrading programmes in HDB flats. So essentially, Dr Teo Ho Pin is asking people to be thankful that the Town Council can generate returns to pay for election carrots. Did Dr Teo Ho Pin go in “with his eyes open“? I sure hope he did, given the exorbitant MP salary he is receiving. With that kind of first world salary, we should be demanding first world performance from our MPs. Instead, Dr Teo has dished out a meager investment return and told us to be grateful for it. That kind of hubris and arrogance is unacceptable. Many residents have also complained about the lack of transparency in the way Town Councils manage their funds, but no substantial answers have been offered. According to Dr Teo Ho Pin, Town Councils cannot reveal their investment strategies, but he tried to assure residents that they “abide by the proper financial reporting system.” Is this the kind of answer we expect from one of the most highly paid parliamentarians in the world? Residents have every right to know how Town Councils manage their funds as the funds are obtained from conservancy charges which they pay on a monthly basis, and are supposed to be used for the maintenance of the estate on a not-for-profit basis. For Dr Teo Ho Pin and other PAP MPs to skirt around the issue and offer such vague replies is an abdication of their fiduciary responsibilities to residents. Will Dr Teo Ho Pin now take the rap for this bad investment decision, or will he, like PM Lee Hsien Loong (during the Mas Selamat saga), say “What to do? It has happened.” More seriously, this whole episode illustrates the fact that even PAP Town Councils went into the structured products investments thinking that they were safe bets. If even the Town Councils can be fooled thus, how much more ordinary citizens like retirees who may not have had the privilege of a decent education or who may be unable to understand English? The PAP Town Councils affected by the failed investments have thus far done the politically correct thing by not raising a ruckus over the issue and not publicly asking the banks for a fair compensation, as that would greatly strengthen the case of individual investors to receive the same. But just because PAP Town Councils have chosen to swallow their losses grudgingly does not mean individual investors should do likewise. www.ngejay.com/?p=1361 |
