• IP addresses are NOT logged in this forum so there's no point asking. Please note that this forum is full of homophobes, racists, lunatics, schizophrenics & absolute nut jobs with a smattering of geniuses, Chinese chauvinists, Moderate Muslims and last but not least a couple of "know-it-alls" constantly sprouting their dubious wisdom. If you believe that content generated by unsavory characters might cause you offense PLEASE LEAVE NOW! Sammyboy Admin and Staff are not responsible for your hurt feelings should you choose to read any of the content here.

    The OTHER forum is HERE so please stop asking.

What is KJ's problem?

IMF has started to write off loans routinely since 2005, starting from the African countries to Pakistan. The British has advocated IMF to sell off some of its Gold reserves to finance such write off but IMF didn't use that. Apparently, G8 has been consulted not only because they are the main stake holders but rather, some requirements of them to exercise write off of loans to IMF were needed to execute that. That is why England suggested selling off the Gold reserves to finance that instead but failed.

If you observed, even Japan has written off debts to Burma under the blanket of IMF initiated loans. IMF may not come up with its own funds directly when they issue loans to countries but instead, make a concerted efforts to arrange loans contributed by various countries and their banks.


Goh Meng Seng

Routinely? I think not. The IMF collects repayment more often than it agrees to a writeoff. In fact, they are such high-handed assholes that getting a IMF loan is akin to inviting a loan shark to move into your house. Take a look at the Fund's loan portfolio if you don't believe me. I would also point out that a large portion of the debt you refer to (as written off) had already been repaid, on top of these poor nations having to put up with IMF conditionality (ie. that loanshark sitting in your living room all the time).

The UK suggestion of the gold sell off was meant for the IMF to write off ALL the debt owed from poor nations. They can afford it because the Fund has something like 40+ billion USD in gold at market value (which their own accountants value at 8.5 billion USD). The IMF doesn't actually need all that gold since it funds itself from member quota contributions (NOT pledges). As you gather, the IMF didn't like that idea. BTW, the UK made that suggestion for POLITICAL reasons, which I don't have the time to go into right now.

The G8 was consulted because they have veto powers over ALL IMF decisions. The IMF write offs didn't require anyone to simultaneously writeoff direct IMF loans because the IMF's quota contributions + retained earnings were MUCH more than enough to meet the purpose.

Japan wrote off it's own direct development aid to Burma. It wasn't a loan to the IMF which was then directed to Burma. The IMF may have been a mediator to arrange that loan but in the end, it was a direct loan from japan to burma. Naturally, direct development loans to Burma are MOST RISKY, while loans to the IMF are not.
 
As a politician it is his job to question the government be it right or wrong. Being a busybody helps to keep the people in-charged on their toes, if he rock the correct issues, it can help him score political points. People may see him as an idiot, but it is better than doing nothing, not trying at all.

KJ request the government to setup a COI to investigate on this loan. It is an IN thing.

You don't get anywhere by rocking any darn issue without rhyme or reason eg. accusing people of acting ultra vires (with respect to the Constitution) only allows them to seek proper legal opinion to show how stupid you look (at least in the eyes of rational thinking people)

KJ needs to start rocking the right boat ie. WHY is Parliamentary approval not required and WHY the Constitution should be changed in this regard.
 
KJ is doing a great job for all Sporeans, otherwsie more will not be accountable if they think all sporeans are daft.

Then why did some many of them not vote for him and his party, when many were already leaning to the opposition cause?
 
This begs the obvious question - Why does MAS have such a large pool of funds which can be used to help foreigners but cannot be used to help Singaporeans? Surely prudent governance would require review of the size of the OFR to see it is of appropriate size. If it is excessively large, the surplus funds should be transferred out of MAS. MAS should NOT be having huge hidden pools of money so that it can give US$4 billion loan pledges without having to seek approval from Parliament and the President.

If activated, the funds will come from the OFR managed by the MAS. You don't get to use funds from the OFR to finance MRT trains etc. So even without the pledge, you still don't get all that $$ to spend on making Singaporeans better off.
 
Last edited:
This begs the obvious question - Why does MAS have such a large pool of funds which can be used to help foreigners but cannot be used to help Singaporeans? Surely prudent governance would require review of the size of the OFR to see it is of appropriate size. If it is excessively large, the surplus funds should be transferred out of MAS. MAS should NOT be having huge hidden pools of money so that it can give US$4 billion loan pledges without having to seek approval from Parliament and the President.

The OFR exists so that MAS can maintain a stable and strong (but not too strong) S$. It has to be necessarily large because maintaining confidence in a currency requires a hefty sum. All govts have some form of OFR as a floating exchange rate system requires it. You will note that when a nation's OFR falls too rapidly, the currency goes into tailspin. The IMF pledge that you refer to, was made as part of a global exercise to support the IMF's crisis mgt efforts. Helping to avoid an international financial crisis can be seen as ensuring the S$ doesn't have a heart attack down the road. Having said that, it is common practice that some parliamentary approval is sought when large financial assistance is offered across borders. Singapore needs to look into this matter!

As for MRT trains, buses etc... The govt has more than enough funds (doesn't need the $ in the OFR) to make our lives better off. What's stopping them is not the lack of $ BUT THE LACK OF WILL! So Singaporeans need to continue voting in more opposition MPs to assist this govt in finding that WILL TO HELP SINGAPOREANS.
 
Last edited:
Agree on the need for a reasonably large OFR. The question I posed was whether perhaps the OFR under MAS is excessively large so that MAS can toss around US$ 4 billion loan pledges without breaking a sweat and without consulting Parliament.

Also on the size on the loan pledge, Singapore's pledge is 2 to 3x the loan pledge of UK, Australia and New Zealand on a per capita basis. Is there a reason why Singapore needs to pledge so much as compared to rich industrialized countries like UK, Australia and New Zealand. If we follow what other rich industrialized countries have pledged, our pledge should be US$1.5 to US$ 2 billion.

The OFR exists so that MAS can maintain a stable and strong (but not too strong) S$. It has to be necessarily large because maintaining confidence in a currency requires a hefty sum. All govts have some form of OFR as a floating exchange rate system requires it. You will note that when a nation's OFR falls too rapidly, the currency goes into tailspin. The IMF pledge that you refer to, was made as part of a global exercise to support the IMF's crisis mgt efforts. Helping to avoid an international financial crisis can be seen as ensuring the S$ doesn't have a heart attack down the road. Having said that, it is common practice that some parliamentary approval is sought when large financial assistance is offered across borders. Singapore needs to look into this matter!
 
People are deliberately evading the question - is money lent to IMF considered part of the OFR? Just like is money "lent" to UOB by way of deposit is considered part of my assets? If so, I do not know why so much ado about nothing.

And giving reserves away to losers isn't going to make Singapore a better place. It will make Singapore go downhill.

Agree on the need for a reasonably large OFR. The question I posed was whether perhaps the OFR under MAS is excessively large so that MAS can toss around US$ 4 billion loan pledges without breaking a sweat and without consulting Parliament.

Also on the size on the loan pledge, Singapore's pledge is 2 to 3x the loan pledge of UK, Australia and New Zealand on a per capita basis. Is there a reason why Singapore needs to pledge so much as compared to rich industrialized countries like UK, Australia and New Zealand. If we follow what other rich industrialized countries have pledged, our pledge should be US$1.5 to US$ 2 billion.
 
What's special about this pledge is that Singapore is able make it without any Parliamentary Scrutiny! Let's focus on that!

Yes, this is the key point imo.
Discuss so long need a londontrader and a sgtrader (cass888) to explain to SG's number 1 freedom fighter (GMS).

is money lent to IMF considered part of the OFR? Just like is money "lent" to UOB by way of deposit is considered part of my assets?

cass888, yes to both questions imo.
Another issue in addition to parliamentary scrutiny before the event is this. Hypothetically, if you go to UOB and demand your deposit back, and assuming there is no problem with your identity or the existence of the deposit, they must give it to you on demand. If they don't, you can report them to MAS. But in the event that IMF doesn't pay on demand, who can SG government report to? MAS or IMF?

Of course as pointed out, the likelihood of this happening is very small, and also other countries will be in the same boat.

Btw, reported that IMF seeking 400 Billion, so SG commitment is only about 1%.
 
MAS must deposit the OFR somewhere. IMF is much safer than Citibank or UOB imo.

But in the event that IMF doesn't pay on demand, who can SG government report to? MAS or IMF?
 
Last edited:
It was not too long ago that Singaporeans lost huge sums of money when they "lent" it to Lehman mini-bonds and Pinnacle Notes. Like investing in Lehman mini-bonds and Pinnacle notes, this loan pledge is not a low risk endeavor. To this date, there has been no published material on the default risk or the amount of interest that Singapore will be earning. We also do not know if there are clauses like the infamous "credit event" which will cause this instrument to become worthless.

People are deliberately evading the question - is money lent to IMF considered part of the OFR? Just like is money "lent" to UOB by way of deposit is considered part of my assets? If so, I do not know why so much ado about nothing.
 
Why is Singapore so special when there is no parliamentary scruntiny over the UK's larger loan? Is Singapore going to be stingy?
 
MAS must deposit the OFR somewhere. IMF is much safer than Citibank or UOB imo.

Another important point is that other bigger and more influential countries will be in the same boat.
Place or invest anywhere else and it will be considered in isolation with other creditors/stakeholders of that organization.
 
Another important point is that other bigger and more influential countries will be in the same boat.
Place or invest anywhere else and it will be considered in isolation with other creditors/stakeholders of that organization.

Other countries pledged more. Why no KJ style letter from their constituents?
 
It was not too long ago that Singaporeans lost huge sums of money when they "lent" it to Lehman mini-bonds and Pinnacle Notes. Like investing in Lehman mini-bonds and Pinnacle notes, this loan pledge is not a low risk endeavor. To this date, there has been no published material on the default risk or the amount of interest that Singapore will be earning. We also do not know if there are clauses like the infamous "credit event" which will cause this instrument to become worthless.

The alternative to this IMF commitment is possibly going to be investment funds for the country's swf, buying bonds of other countries, or placing in other financial institutions, which could all be more risky than a future placement with IMF. Helping the country and the people's lives is great provided there are really good ideas to channel these into value creating activities which will really benefit many including future generations.

Frankly, looking at people and how they behave these days, even if they decided to distribute $1000 cash each to 4 million people, the beneficiaries of these will probably be casinoes, sg pools or foreign remittance agencies!!!
 
Other countries pledged more. Why no KJ style letter from their constituents?

Aiyah, KJ also not totally wrong here lah.
Parliamentary scrutiny (which of course is a mere formality in SG) is fine and it's ok for him to question that.

Then again, as a politician, he should also realise that something like this is not one of the key concerns of most Singaporeans.
A commitment or future loan to IMF is also not negative for SG, considering that it's only 1% of what IMF is looking for and many countries are doing the same.
 
Going back to my Lehman example, people were induced to place money into the instruments because Lehman was supposedly a "safe" global investment bank. This seems to be the same argument some here are using to justify why our loan pledge to the IMF, if called upon, is a "safe" investment. It should be noted that up till the time when Lehman went bankrupt, none of the paper that Lehman sold had ever defaulted. You therefore cannot say that just because IMF has never defaulted before, this loan pledge if called upon is a "safe" investment.

The alternative to this IMF commitment is possibly going to be investment funds for the country's swf, buying bonds of other countries, or placing in other financial institutions, which could all be more risky than a future placement with IMF. Helping the country and the people's lives is great provided there are really good ideas to channel these into value creating activities which will really benefit many including future generations.
 
Last edited:
You therefore cannot say that just because IMF has never defaulted before, this loan pledge if called upon is a "safe" investment.

Bro, there is no absolutely "safe" investment anywhere.
The question is that if IMF come calling and the % in question is 1% of their total requirement, other countries are also committing/lending, the other party is IMF itself and not just any one financial institution or any one country, do you say no on the basis that it is not safe?
 
If it was such a "safe" and "good" investment opportunity, countries like China with huge surpluses would be banging down the door to pour money into this investment. If you look into the details, you will probably find that it is a high risk/low return investment.

The argument below also cannot hold water. Going back to the Lehman example, just because you bought less than 1% of the paper Lehman issued does not make the investment "not risky".

Bro, there is no absolutely "safe" investment anywhere.
The question is that if IMF come calling and the % in question is 1% of their total requirement, other countries are also committing/lending, the other party is IMF itself and not just any one financial institution or any one country, do you say no on the basis that it is not safe?
 
Last edited:
The argument below also cannot hold water. Going back to the Lehman example, just because you bought less than 1% of the paper Lehman issued does not make the investment "not risky".

My argument is not based on having 1% of the investment. It's based on the following:

1. Other countries are providing the other 99% of the requirement. If IMF needed 4 Billion and SG "gallantly" provided all 4, I would be arguing on your side. IMF's requirement is 400 Billion.

2. Back to the earlier post, what would be the alternative investment/placement for the 4 Billion if not with IMF? As part of swf funds, buy other countries' bonds or place in another financial institution? All these could be more risky with questionable returns. Even if there is a project to help Singaporeans, what is it and how much would it cost? Surely it can't be distribution of $1000 each to 4 Million people.

3. If you were the policy/decision maker, went to the IMF meeting and now the country is faced with the decision based on IMF's requirement, what do you do? Reject them and say you have other uses for the funds? The analogy I have in mind is not the Lehman papers, but more of a holding company with 100 subsidiaries asking for an interco loan from each of the subsidiaries to "fund their big project". How would you respond to such a request?

4. No doubt this government could be spending money better to make peoples' lives better and possibly getting poor returns for some investments, including some personnel. In other words, money could be better spent/invested or placed.
I just don't think this is one of those cases, notwithstanding the issue of parliamentary scrutiny and being transparent with all the terms. Obviously, if there is a clause that says the loan from SG doe not get repaid if certain countries default on the loans from IMF to them, then it's a different story and we can certainly discuss again.
 
UK is debt ridden, double dip recession, high unemployment, and functioning democracy much better than Singapore. Their constitution also is similar. Yet no parliamentary approval was asked for their 10 bn pledge.

Suddenly, KJ enters and fusses over Singapores 4 bn pledge. 4/10 of the UK's.

I thought KJ wanted SG to be like the UK?
 
Back
Top