Singapore Foreign Reserves

[LeMans2011]

Ok i have been trying to understand the concept of Singapore's National Reserves and Foreign Reserves, what do they comprise, etc. These are my findings for a start, please correct me if you spot any mistakes:

1) National Reserves =/= Foreign Reserves although most people regards foreign reserves as a good proxy of national reserves

2) National Reserves = National Assets minus national liabilities, this will include the value of all buildings and assets owned by the government minus debt, plus foreign reserves, etc

3) The level of national reserve is a "national secret", but foreign reseves numbers are published on MAS website, official foreign reserve @Mar'11 is about S$294 billion

So what would be a key difference between national reserves and foreign reserves?

4) Foreign reserves does not include values of land and buildings and whatever owned by the government located in Singapore. Hence i am not surprised if you add this the national reserves would be a much larger number than the foreign reserves given that land and buildings in this country is worth a lot of money.
This also explains why the govt is keen to prop up the values of properties. (Bear in mind land and buildings are not recorded at cost, but marked to market.)

5) BUT national reserves will have to minus local debt, the largest being the money we lend to the government via CPF board and the figure is about S$160 billion currently. This number is not deducted against foreign reserves.

6) Most of our national reserves are invested and managed by Temasek Holdings and GIC (about S$127 billion and S$100 billion resp)

7) Of the S$294 billion or US$233 billion of foreign reserves, about 20% are in liquid assets like cash / deposits, whereas about 80% are in foreign securities. Of the 80% in foreign securities, about US$ 67 billion are holdings of US govt treasury bonds

8) Obviously, the budget surplus accumulated over the years form part of our national reserves.

Hence to understand how our national reserves are being managed, you need to piece together CPF Board financials, Temask Holdings financials, GIC financials, MAS foreign reserves report.

 

[LeMans2011]

A country's foreign reserve will be low if it has huge overseas borrowing, like the US. I do not know how much Singapore government securities are held by overseas government or institutions, but for sure the huge amount of money the government borrows from peasants via CPF is not reflected in the foreign reserves. The foreign reserves number therefore shows only one side of the equation, do not be fooled by the big number.

Given that all the reserves are managed by Temask and GIC, looking at performance of Temasek and GIC is the right focus whether the national reserves are managed properly.

Don't forget the other major source of national reserves would be the taxes collected from corporate and peasants since time immemorial. Once again a huge national reserves say nothing about well-being of peasants if the money is sucked from peasants in the first place. Just collect S$1k a year from your 3 million household (through all kinds of hidden taxes) and you can have S$3 billion, easy?

 

[Papsmearer]

Foreign reserves and national reserves are really 2 different animals. Foreign reserves are one component of the national reserves. Foreign reserves are managed by the MAS. these are foreign exchange reserves, namely, the money in foreign currency held by the singapore govt. i.e. USD, Euros, pounds, etc. They are about $233 billion. Singapore also has gold reserves worth another $60 billion.

National reserves on the other hand are all the assets of the govt. (i.e. cash, stock, land, buildings, monies in GIC and Temasek, ownerships in GLCS, stat board assets, cars, furniture, computers, etc) minus liabilities. Even Temasek has several billion $ in bond issues that it sold to investors, so this would be part of their liabilities. The govt. also borrows money, as to many stat boards and GLCs, and these are all subtracted from the assets to arrive at the NAtional Reserves. As you know, its a secret. Also, Ong Teng Cheong was rebuffed when the tried to find out.

The problem with calculating the singapore national reserves is two fold.
1) Unlike all other countries in the democratic world, the govt. owns the vast majority of land in singapore. therefore, they can and do manipulate the price of land and properties, and hence manipulate the amount of money in this investment category. If they want to increase this portfolio by $5 billion tomorrow, they can easily do it by many means such as inflating property assessments, increasing the minimum tender prices for lots, price new flats at higer amounts, etc. So, how do u trust the amount stated in this category.
2) The govt. is so hugely and directly involved in the national economy. They own shipyards, airlines, newspapers, radio stations, taxi companies, hotels, manufacturing companies, electronics, companies, etc. etc., many of these being monopolies or oligopolies. Because the net assets of all these govt. own businesses also constitute part of the national reserves, these companies can manipulate their share price and increase the govt's reserves by monopolistic or oligopolistic pricing. e.g if SMRT wants to raise the fares, and increase their profit, their share prices will also increase, and since the govt. owns the majority of shares, the govt. will also benefit by an indirect increase to ist national reserves.

In some ways, what they told OTC was right, its damn hard to calculate. But they made it hard on themselves by getting their fingers in so many pies. However, an approximate number is well within their ability a calculate, but they could not be bothered.

 

[myo539]

Good work! The opposition are salivating - imagining laying hand on those billions to distribute to their supporters in Aljunied and elsewhere; they are counting the chickens - before they are hatched.

 

[Papsmearer]

Good work! The opposition are salivating - imagining laying hand on those billions to distribute to their supporters in Aljunied and elsewhere; they are counting the chickens - before they are hatched.

First, u stupid bitch, the oppo must win the elections and form a coalition. Than the coalition must agree to go to the president to withdraw the reserves. The president must agree with this request or he will veto it. Since the president is a PAP balls licker and Old Goat crony, he will never agree. SO,t he oppo ate not going to waste time laying hands on those billions like you say. I guarantee u what they will do is hunt down PAP trolls like u and send some boys over from the ISD to pay u a mid night visit. Its more fun for them to fuck u over, got it bitch?

 

[LeMans2011]

What people should realise is, high reserve =/= good life for the peasants. In fact it could well be the opposite.

Granted that PAP has created enough jobs so that the average peasant has some money to be taxed, the key is really balancing the accumulation of high level of reserves vs giving some back to people. Where is the logic of an ever increasing national reserves, at the expense of the citizens' quality of life? To be truly first world, you need to be able to provide citizens with a good quality of life, at the same time maintaining a reasonable level of reserves.

Singapore ranks #10 in the world in terms of foreign reserves. But what they did not tell you is Thailand ranks #12 not far behind Singapore. What does that tell you about corelation between foreign reserves and quality of life?

 

[death_god]

Hi guys,
Juz wanna know, will there be any effects if there is a decrease in amount of the national reserve? If there is, in what ways the govt will take to top up the amount in the national reserve? Pardon me if i asked a stupid question.

 

[death_god]

Hi guys,
Juz wanna know, if there is a decrease in the amount of national reserve, what effects will there be? How will the govt go about if he wants to top up the money in the reserve. What impact will be caused to the citizens? Pardon me if i juz asked a stupid question.

 

[Cruxx]

What people should realise is, high reserve =/= good life for the peasants. In fact it could well be the opposite.

Granted that PAP has created enough jobs so that the average peasant has some money to be taxed, the key is really balancing the accumulation of high level of reserves vs giving some back to people. Where is the logic of an ever increasing national reserves, at the expense of the citizens' quality of life? To be truly first world, you need to be able to provide citizens with a good quality of life, at the same time maintaining a reasonable level of reserves.

Singapore ranks #10 in the world in terms of foreign reserves. But what they did not tell you is Thailand ranks #12 not far behind Singapore. What does that tell you about corelation between foreign reserves and quality of life?

You could increase the number of zeros in your bank account by selling your house and sleeping at the void deck. But would you be happy? This is the illogic of materialism. Money is just a means to an end.

 

[Papsmearer]

Hi guys,
Juz wanna know, will there be any effects if there is a decrease in amount of the national reserve? If there is, in what ways the govt will take to top up the amount in the national reserve? Pardon me if i asked a stupid question.

I think you need to read the posts here in this thread first. The govt. has already told u many times, they do not know how much the national reserves is. In fact, OTC was told it would take 50 man years to calculate this. So, the quesion of decrease is meaningless. If you don't know how much money u have in your account, how do you know whether to top it up or not. U think its a CPF account?