Are you sure democracy cannot help you financially?

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Monday, 27 July 2009

Singapore Democrats

Is it a coincidence that victims of the Lehman Brothers scam in Hong Kong are being compensated for their losses whereas those in Singapore are not?

Hong Kong's financial authorities have taken action to pressure banks to pay back at least 60 percent (more for older victims) to each investor for their losses incurred as a result of buying the toxic financial products from Lehman.

In contrast, Singaporeans are told that they have to jump through hoops just to have their claims heard.

Even then, they are made to wait for their cases to be heard and, in many cases, are told that their money is irretrievably gone.

Either that or they have to initiate litigation to claim compensation which is an expensive process with no guarantee of success.

Perhaps, the most telling difference is DBS's reaction to the two sets of investors. The Singapore bank volunteered that it would refund Hong Kongers who purchased its troubled products whereas no similar move was made for Singaporeans.

So why the difference between Hong Kong and Singapore?

For one thing, the authorities of Hong Kong are still accountable (and therefore responsive) to its people. This is because its elections are much freer and fairer compared to what we have in Singapore. Elected representatives have to respond to the voice and mood of the electorate.

In Singapore, MPs also have to remain attuned to the voice and mood, but not of the voters. Instead they have to keep an eye and ear out from what their party bosses say. In this matter the PAP, and hence all its MPs, were more intent on protecting the establishment and its system than helping the investor-victims.

And their party bosses have molded the election system in such a way that they will never lose power. If they cannot lose power, what incentive is there for them to pay attention to the voters?

Members of the Legislative Council in Hong Kong have to be sensitive to what their constituents say. Public opinion matters because it is broadcast and published by the media which is reknowned for its freedom and independence from the ruling class.

Singapore's media, on the other hand, can be turned on and off by the PAP. This is not hard to do when the Singapore Press Holdings is controlled by none other than former deputy prime minister Dr Tony Tan.

In addition, Hong Kongers enjoy freedoms of speech and public assembly – and the Lehman victims have exercised their freedom well. It was through their public protests that the banks agreed to compensate them for their losses.

Alas, Singaporean investors can only gather at Hong Lim Park – away from the eyes and ears of the people for whom their angry message was intended. As a result, the banks were free of the pressure to negotiate and compensate.

Free and fair elections, a free media, the freedom to assemble are what made the difference between Hong Kong's investors and Singapore's, even though both groups were sold similar products and were caught out by similar events.

So the next time anyone says that democracy and human rights can't make you money, just remember these four items: Hong Kong - Singapore - Lehman Brothers - compensation.

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Comments (8)

Tue 28 Jul 2009 8:25 AM | teh_si

In the investigation conducted by MAS, it was found that in the sale of these credit-linked notes there were failings at these 10 financial institutions, including the misrepresentation of product risk in the prospectus and pricing statement, and inaccurate and incomplete information given by sales staff to investors.

http://www.mas.gov.sg/news_room/press_releases/2009/MAS_Releases_Investigation_Findings_on_the_Sale_and_Marketing_of_Structured_Notes_Linked_to_Lehman_Brothers.html

The result is that investors were missold these notes whose risks were misrepresented to them and in the process suffered huge financial losses.

So why shouldn't the FIs be made to compensate for the losses suffered by their customers that they misled and buy back the notes at par? Not to mention 70%, whereby the current market value of the minibonds is estimated at 60%

btw the estimated current market value of 60% applies to Lehman minibonds only..
DBS claims the current value of its High Notes 5 is 0%... and these were sold to the mass customers!

Wed 29 Jul 2009 5:53 PM | Commonwealth MRT - Tan Kin Lian

What happened to Tan Kin Lian? No follow up at all to the noises he was making for himself about misselling and all that.

Wed 29 Jul 2009 8:31 PM | BryanT - Devan Nair on Economic Downturn

I was just reading Devan Nair's forward to Francis Seow's book on Seelan's blog and saw this prophetic statement:

"The obvious danger is that if ever Singapore is faced with a serious economic downturn, as is entirely possible given the republic's overwhelming dependence on increasingly volatile export markets, the current disturbing brain drain may be expected to gush into massive exodus. And that would be a sad end for what began as the most promising experiment in socioeconomic growth in Southeast Asia."

Rather apt and ageless.

Wed 29 Jul 2009 8:49 PM | Brendan - To BryanT

BryanT,

I am so glad you are reading from alternative sources Hopefully, this will open your mind to the different views and opinion instead of just one patheic mouthpiece.

From you postings, you are a confused person and need such kind of exposure to the real world to fully comprehend the situation in Sg.

So everybody, le give this lad a bit more encouragement. Keep it up!

Wed 29 Jul 2009 10:45 PM | BryanT - Brendan - confusion in the real world

Thanks for the words of encouragement.

If I may parody Mark Twain's quote, "the reports of my [b]confusion[/b] have been greatly exaggerated."

I'll rather not have a debate what or which is the [b]real world[/b], lest we attract the religious fiends to this forum.

Thu 30 Jul 2009 1:25 AM | quantum

http://www.straitstimes.com/STI/STIMEDIA/image/20090729/sg-clean.jpg

http://www.straitstimes.com/Breaking%2BNews/Singapore/Story/STIStory_409683.html

NTUC Secretary-General Lim Swee Say serving foods to all cleaners on the Cleaners Day. -- ST PHOTO: CHEW SENG KIM

Some 300 cleaners were treated to high tea and games at Swissotel The Stamford Hotel on Wednesday afternoon.

NUTC deputy secretary general Heng Chee How praised cleaners for the difficult work they do, and said they made an important contribution to Singapore by ensuring the country stays clean and hygenic.

'They earn their wages with honesty and diligence, quietly and mostly unnoticed. All the more they should be recognised and appreciated by all of us,' he said.

Thu 30 Jul 2009 2:49 AM | Brendan - re: Brendan - confusion in the real world

[quote=BryanT]
If I may parody Mark Twain's quote, "the reports of my [b]confusion[/b] have been greatly exaggerated."
quote]

Sorry maybe '[b]uninformed[/b]' or '[b]misinformed[/b]' are more appropiate words then.

Anyways, not your fault :)

Thu 30 Jul 2009 3:22 PM | kinlian

This is my reply to Commonwealth MRT.

All you need to do is visit my blog, www.tankinlian.blogspot.com to know what is happening.

Do not sit down on your PC and pass baseless remarks. Check your facts first.

Tan Kin Lian