Singapore 8th most indebted nation on the face on this earth!

[omnia1]

That's the problem with Spore, there's so many gullible people out there
Give them half truths & they will conveniently ignore the danger signals.

As I've said, when people like you find out the "hard facts" you'll be among the first to scream for the PAP's blood.

What is it about the reserves data that I've presented so far that make them "half truths" ? Tell me, I'm all ears and am still waiting ...

Oops ... you can't. Why ? Because the hard fact is that Singapore currently has a very strong reserve position, strong enough to back up every single last dollar of your CPF. Gullible are the folks who are not discerning, who do not bother to dig deeper and do further research when presented with sensational data about Singapore's national debt.

 

[ginfreely]

I've already written of MY CPF & accepted that it's probably gone. When the angry crowds scream for blood, I bet you'll be among them. Maybe heading the mob

If CPF no money already, better spend the CPF to buy property or place in unit trust then to write off leh. Heard that interest rate coming down soon, no more fixed 4% for special account. May be really need to invest in unit trust to try to get higher return than CPF.

 

[Papsmearer]

What is it about the reserves data that I've presented so far that make them "half truths" ? Tell me, I'm all ears and am still waiting ...

Oops ... you can't. Why ? Because the hard fact is that Singapore currently has a very strong reserve position, strong enough to back up every single last dollar of your CPF. Gullible are the folks who are not discerning, who do not bother to dig deeper and do further research when presented with sensational data about Singapore's national debt.

Your problem is that you keep digging up the so call facts but miss out on the big picture. When people try to point you to the big picture, u end up doing the micro "facts". U are a classic example of not being able to see the trees for the forest.

Ask yourself of all the countries on this most indebted nations list, how did they get there? These countries had to borrow a lot of money both internally and externally because of a myriad of negative reasons. In the case of the US, it was to fund two long wars, 911, etc. Other countries like Greece, well, their spending simply outstrip their income (govt. budget deficits), and the EU was prepared to guarantee their loans at that time. But what is S'pore's reason? Do we run a budget deficit every year because we have committed to providing a certain standard of living for our citizens (e.g. universal healthcare), and hence had to keep borrowing until we reach this level of indebtedness? No, we always run surpluses. We have no wars that we are financing. The govt. does not provide a lot of services to the people, so why and where did all this incurred debt come from?

The fact of the matter is that Singapore is unique in that list in that it DOES not actually need to borrow, but it does anyway. And not only small amounts but huge amounts. And for no other purposes than placing the funds with Temasek/GIC etc. so they can gamble it away, and so that the world thinks that they are big time smart investors with deep pockets. If u can give me a better justification for this debt, lets hear it.

 

[steffychun]

Does Singapore borrow from external creditors like the US does?

 

[johnny333]

If CPF no money already, better spend the CPF to buy property or place in unit trust then to write off leh. Heard that interest rate coming down soon, no more fixed 4% for special account. May be really need to invest in unit trust to try to get higher return than CPF.

Have already maxed out the withdrawal for properties purchases.
As for unit trust, when they announced that scheme I was among the 1st in line & I'm still stuck with plenty of losses :(

Not really surprised about the PAP lowering the interest on special accounts. Its another sign that they are having "problems".

 

[omnia1]

Does Singapore borrow from external creditors like the US does?

... But what is S'pore's reason? Do we run a budget deficit every year because we have committed to providing a certain standard of living for our citizens (e.g. universal healthcare), and hence had to keep borrowing until we reach this level of indebtedness? No, we always run surpluses. We have no wars that we are financing. The govt. does not provide a lot of services to the people, so why and where did all this incurred debt come from?

The fact of the matter is that Singapore is unique in that list in that it DOES not actually need to borrow, but it does anyway. And not only small amounts but huge amounts. And for no other purposes than placing the funds with Temasek/GIC etc. so they can gamble it away, and so that the world thinks that they are big time smart investors with deep pockets. If u can give me a better justification for this debt, lets hear it.

That's a fair question (and a good one) - If the Singapore govt chalks up surpluses year after year, why on earth does it still borrow and incur such a large US$254 billion national debt ?

You are right in that unlike many other countries, the Singapore govt does not need to borrow to finance expenditure (education, defence etc). As explained by MOF, the Singapore govt borrows for two reasons, and two reasons only:

1. CPF - The CPF money that you contribute is invested in special govt securities (ie: govt takes the money and issues an "IOU"). What this means is that if you put in S$1 of CPF, the govt owes you S$1. If you put in S$50,000/- in CPF, the govt owes you S$50,000/-. If 3.36 million people put in S$198 billion in CPF (stats as at Jun 11), the govt owes them S$198 billion. Notice that the govt now suddenly has a national debt of S$198 billion ! This forms a large chunk of the national debt. When folks withdraw their CPF, this part of the national debt reduces. When folks put in more money into their CPF, the national debt increases. That's how the model works.

2. Development of the debt market - Folks and institutions buy and sell "debt". To have a deep and liquid debt market (which would contribute to Singapore's development as a financial centre), it is important that there be a supply of govt debt (ie: govt securities) that can be traded. Therefore, in order to develop the local debt market, the Singapore govt issues securities so that there would be a supply of govt debt available for trading etc by market participants. You could almost say that the govt is borrowing for the sake of borrowing in order to create a supply of govt securities for the benefit of the debt market.​

So if the govt does not need to spend any of these monies that it collects (CPF + debt issuance), where do they go to ? These monies go into the government's reserves and invested. They are not "all gone" as ignorantly claimed by some folks. This is shown by the huge reserves maintained by the Singapore government that way exceed what it owes due to CPF and debt issuance (ie: the national debt).

Now, that is the big picture .

 

[Papsmearer]

That's a fair question (and a good one) - If the Singapore govt chalks up surpluses year after year, why on earth does it still borrow and incur such a large US$254 billion national debt ?

You are right in that unlike many other countries, the Singapore govt does not need to borrow to finance expenditure (education, defence etc). As explained by MOF, the Singapore govt borrows for two reasons, and two reasons only:

1. CPF - The CPF money that you contribute is invested in special govt securities (ie: govt takes the money and issues an "IOU"). What this means is that if you put in S$1 of CPF, the govt owes you S$1. If you put in S$50,000/- in CPF, the govt owes you S$50,000/-. If 3.36 million people put in S$198 billion in CPF (stats as at Jun 11), the govt owes them S$198 billion. Notice that the govt now suddenly has a national debt of S$198 billion ! This forms a large chunk of the national debt. When folks withdraw their CPF, this part of the national debt reduces. When folks put in more money into their CPF, the national debt increases. That's how the model works.

2. Development of the debt market - Folks and institutions buy and sell "debt". To have a deep and liquid debt market (which would contribute to Singapore's development as a financial centre), it is important that there be a supply of govt debt (ie: govt securities) that can be traded. Therefore, in order to develop the local debt market, the Singapore govt issues securities so that there would be a supply of govt debt available for trading etc by market participants. You could almost say that the govt is borrowing for the sake of borrowing in order to create a supply of govt securities for the benefit of the debt market.​

So if the govt does not need to spend any of these monies that it collects (CPF + debt issuance), where do they go to ? These monies go into the government's reserves and invested. They are not "all gone" as ignorantly claimed by some folks. This is shown by the huge reserves maintained by the Singapore government that way exceed what it owes due to CPF and debt issuance (ie: the national debt).

Now, that is the big picture .

U are still dancing around the issue. U have not answered it at all.

On the point of CPF. U still have not explain why the govt. needs to issue $198 billions in IOUs to the CPF. Why do they need to borrow this much money from the CPF if they are running a budget surplus every year? There is absolutely no law or obligation for the govt. to even borrow $1 from CPF. The CPF acts as a hybrid trust company and insurance issuer that sells annuities. When the CPF sits on all this cash, it has the choice to invest the funds with any number of investment bankers or mutual funds companies anywhere in the world. For example, CPF could park their funds with JP Morgan or Lazard Freres. They could be earning a 5-8% yield with JP. But instead they are forced to invest their funds in S'pore govt. debt instruments at a relatively low yield. And the only way that CPF can make this work is by paying the contributor an even lower yield (hence u have your 1-2% over most of the last 2 decades). The closest analogy to what the govt. is doing is say for example u have the ability to go to your own bank, demand they lend u any amount of money they have and you at the same time tell them how much interest u want to pay them. Sweet deal, no? But u can see from the books that the S'pore govt. does not need the money. So, what do they do with it? Well, it turns out that the more money the govt. can borrow from the CPF, the more money goes to the 2 sovereign funds Temasek and GIC. They are betting that the Temasek and GIC will use the cheap money from CPF to make much higher returns. It seemed like a no brainer to them, except that LKY is so paranoid that he cannot and will not put a professional fund manager in there to run it. hence, u have Whore Jinx who proceeds to lose $billions on what should have been a sure bet. This is why people say their CPF money is gone.

On your point of development of the debt market, sure its important. But look at the size of the debt market vis a vis the country. Its way out of proportion. The whole point of developing the debt market is so that local and foreign investors (both individual and institutional) can participate by buying your debt intruments. Well, your first point already torpedoes your second point. Which is, if the govt. really wants to develop the debt market, it will not allow 80% of the debt market to be dominated by 1 entity, CPF and other Govt. related agencies.

Again, your last paragraph shows your ignorance on this issue. U confusing CPF with tax revenues. The govt. does not collect CPF money (it is collected by the CPF and held in trust for your retirement), the govt. on the other hand collects peronal taxes and can spend them anyway it sees fit, unlike with CPF. CPF can easily cut out the govt. entirely and place its funds with different investment banks both local and international. CPF money cannot be a reserve. Any part of The "huge reserves" that came from borrowing cannot be a reserve because it has to be paid back. The real singapore reserves were funds accumulated over decades from budget surpluses.

 

[omnia1]

...On the point of CPF. U still have not explain why the govt. needs to issue $198 billions in IOUs to the CPF. Why do they need to borrow this much money from the CPF if they are running a budget surplus every year? There is absolutely no law or obligation for the govt. to even borrow $1 from CPF. The CPF acts as a hybrid trust company and insurance issuer that sells annuities. When the CPF sits on all this cash, it has the choice to invest the funds with any number of investment bankers or mutual funds companies anywhere in the world. For example, CPF could park their funds with JP Morgan or Lazard Freres. They could be earning a 5-8% yield with JP. But instead they are forced to invest their funds in S'pore govt. debt instruments at a relatively low yield. And the only way that CPF can make this work is by paying the contributor an even lower yield (hence u have your 1-2% over most of the last 2 decades). The closest analogy to what the govt. is doing is say for example u have the ability to go to your own bank, demand they lend u any amount of money they have and you at the same time tell them how much interest u want to pay them. Sweet deal, no? But u can see from the books that the S'pore govt. does not need the money. So, what do they do with it? Well, it turns out that the more money the govt. can borrow from the CPF, the more money goes to the 2 sovereign funds Temasek and GIC. They are betting that the Temasek and GIC will use the cheap money from CPF to make much higher returns. It seemed like a no brainer to them, except that LKY is so paranoid that he cannot and will not put a professional fund manager in there to run it. hence, u have Whore Jinx who proceeds to lose $billions on what should have been a sure bet. This is why people say their CPF money is gone.

On your point of development of the debt market, sure its important. But look at the size of the debt market vis a vis the country. Its way out of proportion. The whole point of developing the debt market is so that local and foreign investors (both individual and institutional) can participate by buying your debt intruments. Well, your first point already torpedoes your second point. Which is, if the govt. really wants to develop the debt market, it will not allow 80% of the debt market to be dominated by 1 entity, CPF and other Govt. related agencies.

Again, your last paragraph shows your ignorance on this issue. U confusing CPF with tax revenues. The govt. does not collect CPF money (it is collected by the CPF and held in trust for your retirement), the govt. on the other hand collects peronal taxes and can spend them anyway it sees fit, unlike with CPF. CPF can easily cut out the govt. entirely and place its funds with different investment banks both local and international. CPF money cannot be a reserve. Any part of The "huge reserves" that came from borrowing cannot be a reserve because it has to be paid back. The real singapore reserves were funds accumulated over decades from budget surpluses.

1. CPF

In that case, the more appropriate question to ask is not "Why does the government need to borrow ?" but rather "Why has the current CPF investment model been chosen ?"

You are right that the CPF could have been structured in alternate ways. However, each structure would have its own pros and cons. CPF could very well have been set-up to invest its monies directly with fund managers as you've suggested. You would certainly expect to get a higher return BUT you would also be exposing yourself to increased market and credit risks. You might earn 5-6% return one year but 0-0.5% the next. Worse still, you'd be screwed if you had invested in greek government bonds or Lehman Brothers. In contrast, in the current CPF model, you are investing in AAA Singapore government securities where the interest that you get on CPF is pegged to the fixed/savings deposit rates of major local banks (so it's not true that the govt can directly set whatever interest it wants to pay on the CPF monies based on it's own whim and fancy). Of course, in return for the government guarantee on CPF monies and the lower risk exposure, your CPF monies would earn a lower interest rate. Which model is better ? Like I said, each has its pros and cons and there can be a whole separate discussion on their respective merits.

I would also agree with you that the Singapore government is effectively holding our CPF monies in trust. If we do not want to regard these S$198 billion CPF monies as 'reserves', not a problem. By the same token, we should then also exclude these CPF monies from the national debt (ie: net them off). If we do so, we will see the national debt shrink dramatically to less than US$100 billion (rough back-of-the-envelope calculations). Guess what ? Singapore may then not even feature on the Fortune list of the "World's Most Indebted Developed Countries", there would not be this thread with such a sensational (but misleading) headline and we would not even be having this conversation ! ... lol

Not to mention that government reserves would still be more than sufficient to cover this remaining debt even without CPF monies.

So in short,

• Why does the govt still need to 'borrow' ? Largely because of how the CPF is structured.

• Are there alternative CPF strutures/models ? Certainly, each with pros and cons. Whether they are 'better' is debatable.

• Could we better tweak CPF withdrawal policies to meet Singaporean's needs ? Possibly.

• Should we be concerned by this piece of news that Singapore is the 8th most indebted developed country in the world ? No, if you understand the truth and facts behind the numbers.

• Is your CPF monies all gone ? Of course not

2. Debt Market Development

As for the development of the debt market, I would like to point out that CPF monies are invested in special government securities. As far as I know, these special securities are not tradable on the market unlike other normal Singapore government securities. And I don't think the government prevents any party (local or foreign) from buying and trading its securities. So I don't see why you should have an issue with the Singapore government issuing securities for the development of the local debt market.

 

[Zombie]

I do not want to go into depth. Let me just point this out...

In contrast, in the current CPF model, you are investing in AAA Singapore government securities where the interest that you get on CPF is pegged to the fixed/savings deposit rates of major local banks (so it's not true that the govt can directly set whatever interest it wants to pay on the CPF monies based on it's own whim and fancy).

Before 1987, we already had CPF/govt borrowing, but we did not have active secondary market (ie no market-maker).
Thus in 1987, the govt revamped its govt securities (ie cpf-related and primary market) so that it can provide a yield curve benchmark for the secondary corporate bond market (ie for banks etc).
No offense... but the whole perspective and most of the points raised so far, is like putting the cart before the horse.

 

[Seee3]

I only remembered the Lim guy, after his retirement, came out to boast about how during the crisis in the mid-80s, the CPF was increased to mop up the extra cash. This was the most open admission ever, by their people that CPF primary objective is also a tool to control money supply.

CPF is a debt, a very special one where the debtor can elect to delay payment and for all you know, never pay also can. It is also a very special fund where money can be credited to you but you will never get to touch it. However, you can exchange the money for the stay in a flat or the hospital. It is like "vouchers" where purchases can only be made from selected store and on top of that, at selected time.

 

[jw5]

CPF is a debt, a very special one where the debtor can elect to delay payment and for all you know, never pay also can. It is also a very special fund where money can be credited to you but you will never get to touch it. However, you can exchange the money for the stay in a flat or the hospital. It is like "vouchers" where purchases can only be made from selected store and on top of that, at selected time.

CPF is a loan from us to them whereby they unilaterally determine the interest rate and the terms of repayment.

 

[Papsmearer]

CPF is a loan from us to them whereby they unilaterally determine the interest rate and the terms of repayment.

That is pretty much the correct decription. Accept that normally if someone comes to u and ask you lend them money but they will determine how much interest to pay u and when to pay u back, you would tell them to go and suck Cooleo's lancheow. In the CPF case, happy or not, we must lend to the govt.

 

[jw5]

That is pretty much the correct decription. Accept that normally if someone comes to u and ask you lend them money but they will determine how much interest to pay u and when to pay u back, you would tell them to go and suck Cooleo's lancheow. In the CPF case, happy or not, we must lend to the govt.

"Except that" not "Accept that". :o

And normally no need to tell them to suck cock lah, just decline politely can already.
But these arseholes cannot even decline rudely.

 

[Papsmearer]

1. CPF

In that case, the more appropriate question to ask is not "Why does the government need to borrow ?" but rather "Why has the current CPF investment model been chosen ?"

You are right that the CPF could have been structured in alternate ways. However, each structure would have its own pros and cons. CPF could very well have been set-up to invest its monies directly with fund managers as you've suggested. You would certainly expect to get a higher return BUT you would also be exposing yourself to increased market and credit risks. You might earn 5-6% return one year but 0-0.5% the next. Worse still, you'd be screwed if you had invested in greek government bonds or Lehman Brothers. In contrast, in the current CPF model, you are investing in AAA Singapore government securities where the interest that you get on CPF is pegged to the fixed/savings deposit rates of major local banks (so it's not true that the govt can directly set whatever interest it wants to pay on the CPF monies based on it's own whim and fancy). Of course, in return for the government guarantee on CPF monies and the lower risk exposure, your CPF monies would earn a lower interest rate. Which model is better ? Like I said, each has its pros and cons and there can be a whole separate discussion on their respective merits.

I would also agree with you that the Singapore government is effectively holding our CPF monies in trust. If we do not want to regard these S$198 billion CPF monies as 'reserves', not a problem. By the same token, we should then also exclude these CPF monies from the national debt (ie: net them off). If we do so, we will see the national debt shrink dramatically to less than US$100 billion (rough back-of-the-envelope calculations). Guess what ? Singapore may then not even feature on the Fortune list of the "World's Most Indebted Developed Countries", there would not be this thread with such a sensational (but misleading) headline and we would not even be having this conversation ! ... lol

Not to mention that government reserves would still be more than sufficient to cover this remaining debt even without CPF monies.

So in short,

• Why does the govt still need to 'borrow' ? Largely because of how the CPF is structured.

• Are there alternative CPF strutures/models ? Certainly, each with pros and cons. Whether they are 'better' is debatable.

• Could we better tweak CPF withdrawal policies to meet Singaporean's needs ? Possibly.

• Should we be concerned by this piece of news that Singapore is the 8th most indebted developed country in the world ? No, if you understand the truth and facts behind the numbers.

• Is your CPF monies all gone ? Of course not

2. Debt Market Development

As for the development of the debt market, I would like to point out that CPF monies are invested in special government securities. As far as I know, these special securities are not tradable on the market unlike other normal Singapore government securities. And I don't think the government prevents any party (local or foreign) from buying and trading its securities. So I don't see why you should have an issue with the Singapore government issuing securities for the development of the local debt market.

U truly are digging yourself deeper and deeper into a hole. Are you the best that the PAP internet brigade can produce? U do know that u are bringing a knife to a gunfight, right? I ask you why a govt. that runs budget surpluses year after year for decades need to borrow $198 billion from the CPF. U give me a song and dance about the structure of CPF, about how the Singapore govt, debt is AAA, etc. Your investment theory is a joke. U really think parking all your money in Singapore govt. bonds is low risk because they are AAA? U will see how much Singapore bonds are worth if any number things happen, like the Malaysians turning off the water tap for example. U will see the stock market and bond market drop like a stone the next day. When u are org like the CPF u dictate to your investment firm your level of risk tolerance in your portfolio. In the case of the CPF, the risk tolerance must be set low, and they would direct their bankers to invest accordingly. If their bankers put them into risky investments against their investment guidelines, the bankers will face legal action which they cannot win. Hence, buying Greek bonds to use your example will never happen as they are not investment grade. The biggest strength u can have in investment is diversification. When the CPF puts all their eggs in one basket, and even worse in one currency only, its not diversification, its putting us all at risk. Do you understand this simple investment theory?

That is why your theory about why the CPF buys singapore debt because its safe is a joke. No large funds, govt. or otherwise will ever put all their money with one borrower. U can see other funds like the Norwegian sovereign wealth fund, do not park all their billions in Norwegian govt. bonds denominated in kroners. In fact, very little at all. Also, because the singapore govt. is the market maker, and sole buyer of CPF bonds, they can issue any interest rate they want. U are truly stupid when u say the govt. cannot directly set the interest rate that it gives to the CPF. Of course it can. Its the maket maker. The govt. can choose to pay a premium, or the govt. can pay the CPF holders the rate that they receive from their investments using the CPF monies. There is a 1000 and 1 ways for them to pay more than what they are paying now. To say they cannot set the rate is stupid. By right, ethically and legally, CPF has an obligation to invest the holders money in instruments that yield the highest returns possible given a low risk profile. But they are prevented from doing this, because the govt. has hijacked the process and dictate that they can be the only institution that CPF will invest in, and made it worse by paying pittance to CPF holders. The sooner u recognize this fact, the better.

Anyway, everyone can see what u are doing here. This whole thread was a discussion on the size of the singapore govt. debt. U have tried, unsuccessfully to deflect this huge debt issue. U have tried to do this by including the assets and national reserves into this debate. They have nothing to do with the national debt. Just because the national reserves and assets surpassed the national debt DOES NOT MEAN IT IS OK TO HAVE IT SO LARGE. If you include the national assets and reserves, than Singapore would be the MOST indebted nation in the world, not number 8. When u look at the US as the most indebted nation, and using your stupid argument, than the US has nothing to worry about because the US govt. owns land, buildings, properties, mineral rights, weapons, etc. that when added up equals assets way above their debts. Singapore on the other hand, if we add all our assets up, u will see that our debt proportionately is much higher than the US, hence making us the most indebted nation on earth.

 

[Papsmearer]

"Except that" not "Accept that". :o

And normally no need to tell them to suck cock lah, just decline politely can already.
But these arseholes cannot even decline rudely.

Solly, I just cannot go a day without insulting Cooleo. :-)

 

[omnia1]

U truly are digging yourself deeper and deeper into a hole. Are you the best that the PAP internet brigade can produce? U do know that u are bringing a knife to a gunfight, right? I ask you why a govt. that runs budget surpluses year after year for decades need to borrow $198 billion from the CPF. U give me a song and dance about the structure of CPF, about how the Singapore govt, debt is AAA, etc. Your investment theory is a joke. U really think parking all your money in Singapore govt. bonds is low risk because they are AAA? U will see how much Singapore bonds are worth if any number things happen, like the Malaysians turning off the water tap for example. U will see the stock market and bond market drop like a stone the next day. When u are org like the CPF u dictate to your investment firm your level of risk tolerance in your portfolio. In the case of the CPF, the risk tolerance must be set low, and they would direct their bankers to invest accordingly. If their bankers put them into risky investments against their investment guidelines, the bankers will face legal action which they cannot win. Hence, buying Greek bonds to use your example will never happen as they are not investment grade. The biggest strength u can have in investment is diversification. When the CPF puts all their eggs in one basket, and even worse in one currency only, its not diversification, its putting us all at risk. Do you understand this simple investment theory?

That is why your theory about why the CPF buys singapore debt because its safe is a joke. No large funds, govt. or otherwise will ever put all their money with one borrower. U can see other funds like the Norwegian sovereign wealth fund, do not park all their billions in Norwegian govt. bonds denominated in kroners. In fact, very little at all. Also, because the singapore govt. is the market maker, and sole buyer of CPF bonds, they can issue any interest rate they want. U are truly stupid when u say the govt. cannot directly set the interest rate that it gives to the CPF. Of course it can. Its the maket maker. The govt. can choose to pay a premium, or the govt. can pay the CPF holders the rate that they receive from their investments using the CPF monies. There is a 1000 and 1 ways for them to pay more than what they are paying now. To say they cannot set the rate is stupid. By right, ethically and legally, CPF has an obligation to invest the holders money in instruments that yield the highest returns possible given a low risk profile. But they are prevented from doing this, because the govt. has hijacked the process and dictate that they can be the only institution that CPF will invest in, and made it worse by paying pittance to CPF holders. The sooner u recognize this fact, the better.

Anyway, everyone can see what u are doing here. This whole thread was a discussion on the size of the singapore govt. debt. U have tried, unsuccessfully to deflect this huge debt issue. U have tried to do this by including the assets and national reserves into this debate. They have nothing to do with the national debt. Just because the national reserves and assets surpassed the national debt DOES NOT MEAN IT IS OK TO HAVE IT SO LARGE. If you include the national assets and reserves, than Singapore would be the MOST indebted nation in the world, not number 8. When u look at the US as the most indebted nation, and using your stupid argument, than the US has nothing to worry about because the US govt. owns land, buildings, properties, mineral rights, weapons, etc. that when added up equals assets way above their debts. Singapore on the other hand, if we add all our assets up, u will see that our debt proportionately is much higher than the US, hence making us the most indebted nation on earth.

I suspect we are at tangent to one another. Your issue appears to be that you do not think the national debt is 'justified' in the sense that CPF shouldn't be invested in Singapore govt securities but should instead be invested with fund managers etc. That's fine, nothing wrong to hold such an opinion. There are many possible ways to manage the CPF as I've made clear.

My issue on the other hand, is with the sensational headline - "Singapore 8th most indebted nation on the face on this earth !" (exclamation mark no less), which I'm saying is very misleading. When you read someting like that, the immediate questions asked would be (1) why does Singapore have such a large debt (especially with yearly surpluses), and (2) should we be concerned that Singapore has such a large debt ?

I've answered the first question. Singapore has such a large debt because of the CPF structure and because of government's efforts to develop the debt market. Never mind whether one agrees with the CPF model, thinks that there is a better way etc. The fact is that Singapore did not incur the debt because it spent beyond its means (common with some countries) nor because huge sums had been misappriopriated (which is the conclusion a lot of folks would jump to without thinking; just look at the thread comments).

Next question - Should we be concerned with this 'high' national debt ? Folks would ask related questions, "Is Singapore bankrupt ? Is my CPF money gone ?" And the answer to all these questions is a very clear NO. Singapore is not bankrupt, our CPF monies are safe (even if we hate the withdrawal policies) and there is little if anything to be concerned about with this 'high' national debt. Singapore is financially strong, period. And we know this when we look at where the debt came from (Qn 1 above) and the bigger picture of debt vs Singapore's reserves. If the Singapore government did not have these reserves, then we should be alarmed and wonder where all the CPF money went to, and whether Singapore needs to be bailed out of its debt. Reserves have everything to do with whether we should be concerned with the national debt.

 

[Zombie]

the half-blind indo president is correct... we are little red dot..

http://www.economist.com/content/global_debt_clock

 

[Seee3]

This is a great place to learn economics. So, govt sells AAA securities to us and holds the CPF money as reserves. However, I was lost after that. What does the govt do with the money under this CPF reserves? Keep it in the vault, make more money by re-investing, use it to fund infrastructural project.... Experts please help me?

 

[diversifyx2]

http://www.yeocheowtong.com/Salaries.html

 

[Fook Seng]

It is "half-blind" president who used the derogatory "little red dot" but Habibee if I remember correctly.