Raju & Madoff - Tale of Two Scams

While Satyam founder flounders in Indian jail, Wall Street fraudster stays in penthouse home


By Zhen Ming


IT was only last week that Mr Ramalinga Raju - the 54-year-old founder of giant Indian software company Satyam - was enjoying a lifestyle befitting his US$1.3 billion ($1.9billion) fortune.

Over the weekend, however, Mr Raju got thrown into jail in the Indian city of Hyderabad - after admitting that he had orchestrated the country's biggest corporate fraud.

It was a swindle worth at least US$1b, and Mr Raju admitted that he had wildly inflated Satyam's profitability and assets for years.

Halfway around the world, Bernard Madoff, a 70-year-old Wall Street money manager turned self-confessed Ponzi-style swindler, has been allowed bail while awaiting trial.

Mr Madoff has already admitted to stealing as much as US$50b. If so, that would make him the biggest fraudster in global financial history.

Yet, on Monday, a US district judge ruled that Mr Madoff could still remain under house arrest in his penthouse apartment on the Upper East Side of Manhattan.

Today, while Mr Raju languishes in an overcrowded Indian jail, Mr Madoff is probably lounging in his living room watching news about himself on his flat-screen TV.

This, despite Mr Madoff having sent 16 watches (including diamond-encrusted timepieces from Tiffany and Cartier), four diamond brooches and an emerald ring to family and friends.

This, despite him having some 100 signed checks worth US$173 million lying around in his desk ready to be given to others.

To be sure, any American without Mr Madoff's bank account (or influence) would surely be locked up in jail by now.

'What a crock,' said an irate ABC News user in a website posting. 'If I went downtown and shoplifted a loaf of bread, I'd be in jail quicker than you can think... And Bernie goes off smirking at the American people.'

Double standards

Welcome, critics say, to America's supposedly two-tiered justice system - one for the very rich, the other for ordinary Joe six-packs.

In the US, wealthy white-collar crooks like Martha Stewart and Bernard Ebbers have found clever ways of staying out of prison until trial (typically by posting huge bonds).

Astonishingly, despite his own self-admission, Mr Madoff hasn't been charged yet.

What's more, his own sons have remained mum about how they could have worked at their father's firm for decades without noticing that the money he supposedly managed did not exist.

In India, when the Satyam fraud was unveiled last Wednesday, the country's benchmark Sensex index fell by 7.25 per cent in one session - a steeper drop than that which followed the Mumbai terror attacks in Nov.

Aghast institutional investors are seeking compensation in India and in the US, where several class-action suits have been filed.

As of Friday, Satyam was valued at only US$330m as compared to its market worth of more than US$7b six months ago. In other words, Satyam investors will probably recover less than five cents for each dollar invested.

But for Madoff investors, the prospect of getting back their US$50 billion is much bleaker - at the last count, what's left is only two cents for each dollar invested.


Source: The New Paper, Fri 16 Jan 2009

SIGN OF TROUBLED TIMES
Typical US home now cheaper than HDB flat


By Zhen Ming


SO, how bad are things over there, really?

Hungry for first-hand news from the US “economic warfront”, I posed this delicate question about the US economy to Sok (a visiting sister-in-law back from Los Angeles for her year-end break).

It’s truly bad, she lamented, with an atypical grimace on her usually-beaming face.

When we last met in LA around Christmas in 2007, they were happier times.

Back then, our families shopped and dined at The Grove — a boutique outdoor shopping mall located across the street from the world-famous LA Farmer's Market — where, on a good day, you might just stumble upon a Hollywood celebrity (or two).

Meltdown woes

“But today The Grove is much, much quieter,” Sok reported. “You can feel it in the frigid air. And it’s all no thanks to the meltdown on Wall Street.”

To be sure, both Sok and her husband Murali hold relatively stable jobs. She works at an LA library while he teaches at the University of Southern California.

But, not unlike many other Asian expatriates living in America, they, too, worry about whether home prices in the US will ever stop dropping — what with the median home over there now costing only US$180,800 (S$268,500).

Yes, the median American home is now cheaper than most HDB flats in Singapore.

More importantly, my “Chindian” in-laws also worry whether some of their friends, especially those working in California’s Silicon Valley, could soon lose their jobs.

Latest figures

All in all, US employers shed a total of 2.6 million jobs in 2008 — the worst-ever year since 1945.

This latest job loss figure point to a US jobs market that’s still in a free fall.

Many US companies across all sectors of the economy have, in fact, resumed mass layoffs (after a brief respite over the year-end holidays).

Last week alone, insurance provider Cigna Corp, aluminum producer Alcoa Inc, data-storage company EMC Corp and computer products maker Logitech International have announced large job cuts.

"The toughest six months will be the just-completed fourth quarter and the first quarter of this year," said Mr Robert Barbera, chief economist at the Investment Technology Group, a research and trading firm.

Hope and recovery

But Mr Barbera also noted that a widely-anticipated trillion-dollar stimulus package should begin to revive the US economy in the second half of 2009.

Meanwhile, US President-elect Barack Obama has said that the alarming job figures showed that Washington should act quickly and decisively to enact his stimulus plan.

Behind the numbers were "real lives, real suffering, real fears", said Mr Obama.

Overall, US unemployment rate jumped to 7.2 per cent in December — the highest since January 1993.

But that’s just the tip of the US job-loss iceberg.

"Factoring in discouraged workers, unemployment is closer to 9.4 per cent," said Mr Peter Morici, an economist at the University of Maryland. "Add workers in part-time positions that cannot find full-time employment and the hidden unemployment rate is 14.5 per cent."

Nevertheless, the official total of more than 11 million jobless Americans — about 2.3 times the entire population of Singapore — is already quite staggering.

I read, with personal concern, the report that US aerospace giant Boeing expects its 68,000-person workforce will shed 4,500 jobs in the coming 12 months.

The big majority of Boeing’s layoffs will occur in the Puget Sound area of Washington state. That’s where a cousin and her American husband (a Boeing engineer) live.

Back home

Back in Singapore, the local labour market is also showing signs of softening.

The jobless rate among locals (seasonally adjusted) actually rose to 3.3 per cent in September — up from 3.1 per cent in June.

Expect retrenchments in Singapore to pick up pace in 2009.

In the third quarter of last year, a total of 2,346 workers were retrenched — up from 1,798 in the previous quarter.

So, it’s the same everywhere during this global recession.

Expect the “things over here” (in Singapore) — just like the “things over there” (in the US) — to get worse first (before they can get better later on).

The current global economic flu, after all, must be allowed to run its full course.


Source: The New Paper, Sun 11 Jan 2009

Here's how to drink with colleagues in Asia


By Zhen Ming


IN VINO veritas.

It's a well-known Latin phrase which means 'in wine, truth'.

It applies to people who become uninhibited when they drink too much alcohol and start to say what they really think.

The Chinese and Japanese also believe that drinking will enable a person to tell all.

But beyond drunkenness, drinking in Asia (just as in the West) also serves another important purpose - to size up the character of a foreign business partner.

Imagine this all-too-familiar scenario:

It's 2am. You're an expatriate sitting in a dark karaoke club somewhere in China.

Your colleague is making a tired but brave attempt at singing 'My Way'.

Your local partner (the host for the evening) has just fallen asleep again while a hostess pours you another glass of wine and enquires whether you're happy.

And your head is screaming out: I have a wife and two children back home. Must I be doing this?

Yes, you must. But there's a cleverer way to handle nocturnal activities in Asia.

So advise Professor Chow-Hou Wee and Mr Fred Combe in their 408-page book entitled Business Journey to the East: An East-West Perspective on Global-is-Asian.

It's perhaps the best (what they never taught me at Harvard) idiot's guide I've come across so far 'to understand better how Asians strategise and practise business'.

In this highly-readable book (published by McGraw-Hill Education), the authors blend the practical, cultural, and historical realities of doing business in Asia with many down-to-earth anecdotes and refreshing insights.

Throughout the book, our dynamic duo of cross-border consulting explore why Asians and Westerners think and operate differently, examine how the West needs to urgently reappraise its role in Asia and propose that the West adopt a new business approach that combines Asian and Western strategies.

According to Messrs Wee and Combe, the typical office executive in Asia puts on a mask in the office. So do his bosses, customers and other business associates.

However, after several rounds of drinks, the real feelings begin to spill out.

'For example, some people, under the influence of alcohol, start to crack colourful jokes, talk nonsense, or engage in harmless small talk... Worse still, they may even leak corporate secrets,' they wrote.

The whole purpose here is to shed inhibitions with business partners, colleagues, and friends.

And other activities

The authors also offer a useful tip on whether it's okay to turn down 'other extracurricular activities' (beyond drinking or karaoke).

'Unlike the pressures of drinking or singing, this situation is very different. It is very much discretionary, and they will respect your decision,' they wrote.

But the authors also offer this cautionary advice: Do NOT gloat about what happened the night before.

'In the West, it is common to find people talking and discussing about the good fun they had the night before.. Now this is something that you must never do in Asia.'

This 'as if nothing happened the night before' stance is a cardinal rule that is to be respected and strictly adhered to.

'Indeed, this is one of those very rare incidents where many Asians make a clear demarcation between what can or cannot be divulged about their social activities, especially those that occur at night... Any betrayal of this implicit trust and prohibition will not be easily forgotten or forgiven. It is a taboo not to be broken,' they wrote.


Source: The New Paper, Thu 08 Jan 2009

Prices taken from Singapore Department of Statistics in its latest press release on the Retail Sales Index and Catering Trade Index and from the recent issues of the Monthly Digest of Statistics Singapore.

9 prices to track in 2009
These 9 items have cost more in the last year


By Zhen Ming


WHAT you see above is my personal list of nine grocery items whose prices have shot through the roof as of October last year.

There are of course some items whose prices have declined.

With the Chinese New Year buying binge coming up, prices of my nine items have to be watched.

Then, there's the eating-out.

For me, eating out with the extended family is a pleasurable weekend experience.

These days, however, this social-gastronomic experience can be quite a budget-buster for the middle class.

Take the price of an average meal at a typical fast food outlet in October (barely three months ago, when there was financial mayhem in global stock markets).

For each meal then, you had to fork out an astonishing 17.8 per cent more than a year ago (based on the latest-available price comparisons).

Put differently, for the same amount of money spent on seven trips to a typical fast food outlet a year ago, you could afford to make, at best, six.

And the well-to-do are also not spared in this industry-wide price hike.

For those who prefer fine dining, their average up-market meal at a typical restaurant now costs 11.8per cent more.

Those who eat at hawker centres and food courts, however, can take comfort that prices there rose by only 9.1 per cent in the 12 months ending October.

The good news for everyone on a tight budget for 2009:

Eating in can now be just as pleasurable as eating out - more so, ever since the price of food and beverages, on the whole, dropped by a surprising 6.3 per cent over the same 12-month period.


Source: The New Paper, Sun 04 Jan 2009

Sleep well, S'pore


By Zhen Ming


THIS year has been one filled with sob stories - from everyday investors who have seen their life savings shrink to some others losing their jobs.

(I know of an over-leveraged friend who could soon lose his home.)

But in every downturn, there'll also be winners and what has happened in 2008 is no exception.

So here's my take on how Singapore, as a people, has weathered 2008's financial firestorm:

Our resilient economy

As of last year, Singapore was the world's 44th or 45th largest economy, depending on whether you wish to rely on comparative data provided by the International Monetary Fund (IMF), the World Bank or the US' Central Intelligence Agency (CIA).

Singapore then went on to tote up a nominal Gross Domestic Product of S$255.5 billion in the 12 months ended September 2008 (in the month the US credit crunch first turned into a full-blown global financial crisis).

In terms of our nominal GDP per capita, as of 2007, we're now anywhere among the world's 19th - 24th richest people.

On a purchasing power basis, our economic achievement is incredibly impressive.

Depending on which international monitoring agency you choose to rely on, we're now either the world's 3rd (World Bank), 5th (IMF) or 6th (CIA) richest people - definitely well ahead of our financially-beleaguered American friends.

Our strong dollar

And oh, what a volatile year for currencies it has been.

And yet, ironically, we're now roughly back to Square One vis-a-vis major reserve currencies like the US dollar and the euro as well as vis-a-vis the Malaysian ringgit.

Back on 1 Jan, for instance, S$100 could be exchanged for US$69.01.

By yesterday afternoon, the same S$100 could still be swapped for almost the same amount of greenback - that is, US$69.36, to be exact.

Vis-a-vis major Asian currencies like the Japanese yen and the Chinese yuan, however, we've weakened somewhat.

For instance, the money-changer at the mall will now give you only 6,263 yen for your $100 as compared to 7,756 a year ago - down by nearly 20 per cent.

But vis-a-vis currencies like the Australia dollar and the New Zealand dollar, we've seen our purchasing power grown much, much stronger.

A year ago, for example, S$100 could get you only A$79.43 in exchange. By yesterday, however, the same S$100 was worth A$100.56. That translates into a hefty currency appreciation of 26.6 per cent in less than a year!

Overall, however, much to the relief of many traders, the Singapore dollar remains fairly stable vis-a-vis a trade-weighted basket of reference currencies.

Our bulging reserves

Back at the end of 2006, barely two years ago, our official foreign reserves already totalled a humongous S$209 billion.

It is still growing, albeit at a slower pace in recent months (mainly because of the global financial crisis).By end-October, however, our reserves stood at around S$241 billion.

This money will surely come in handy to help us weather the bad economic storm that's still brewing in 2009 and beyond.

In fact, a good chunk of this money has already been set aside to guarantee all regular deposits in our local banking system, thus allowing Singaporeans like you and I to avoid the kind of panic that has engulfed savers in many other countries.

In short, sleep tight, my friend, knowing that all is still well with Singapore.


Source: The New Paper, Wed 31 Dec 2008

Can we expect Santa Claus rally this year?
Stock markets traditionally see upward swing during the 12 days of Christmas


By Zhen Ming


THE bottom line for investors in 2008: Recession, recession, recession.

Methinks, maybe not - there's still a good week left to prove the pundits wrong.

That's my take on the old adage about the Santa Claus rally - a phenomenon that often (but not always) proves remarkably reliable for stock markets around the world.

This year-end rally is usually a surge in the price of stocks that often occurs in the week between Christmas and New Year's Day.

There are numerous explanations for this yearly phenomenon - including tax considerations, happiness around Wall Street (none this year), people investing their Christmas bonuses (again, none this year) and the fact that the pessimists are usually on vacation this week.

For the Singapore stock market in particular, this Santa Claus rally does stand up to fairly rigorous statistical analysis.

Fact and fantasy

Fact and fantasy have marched arm-in-arm on three out of every four Christmases in Singapore in the past 20 years.

That is, if we were to systematically track the performance of this phenomenon as starting from 11 Dec (two weeks before Christmas) and ending on 5 Jan (on the 12th Day of Christmas, remember that song?).

Even during some years when Father Christmas failed to show up in time, he sometimes made up for it - by paving the way for a January Effect rally instead.

On Christmas Eve, the Dow Jones Industrial Jones ended the shortened trading week at 8,468.48 - a 683.13 point pullback from its intra-month high of 9151.61.

Meanwhile, the Straits Times Index closed at 1,736.99 - 3.19 per cent lower than its 1,794.16 closing on 11 Dec (the supposed start date for this year's Santa Claus rally).

But with five trading days still left before the 12th Day of Christmas, the question on everyone's mind: Has Santa skipped Singapore? Or is he just a bit too late this season?

To be sure, the gloomy economic data earlier this week was hardly surprising.

But, this time, it's not only US and European automakers that are hurting.

The Japanese automaker Toyota has already said it expects to post its FIRST operating loss in more than 70 years, an announcement that capped a year of record-breaking corporate losses and sheer drops in global stock markets.

Although stock markets have historically performed well in the weeks around Christmas and New Year's Day, expect investors hoping for a last-minute rally to ring out 2008 to be somewhat disappointed.

At this juncture, expect trading volumes in global stock markets to remain light, what with many traders already on vacation.

Silver lining

But there's an imminent silver lining here: Expect an amazingly volatile January Effect in 2009 when the so-called Big Boys return from their holidays.

These Big Boys (from Shenton Way to Wall Street) have already been quietly accumulating stocks on the sly, all in anticipation of January.

Here's my 'proof' of what's going on:

According to the latest Reuters poll, amid the gloom and doom, global investors quietly lifted their equity holdings for the second month running in December.

Surveys of 44 leading investment houses in the US, Japan, continental Europe and Britain showed an average mixed-asset portfolio holding 56 per cent in stocks, up from 54.8 per cent in November.

Recent uptick

But this recent uptick in equity holdings among the Big Boys still remained below the long-term average holding of almost 60 per cent.

Here's more good news (especially if you had timed your investment successfully): In the past few weeks, world stocks, as measured by the Morgan Stanley Composite Index, rose by around 20 per cent - after hitting a 51/2-year low on 21 Nov.

So, while (for many) Santa might have been late this year, (for me) he's already arrived - in late November, unannounced, and without fanfare.

By all means, do proceed to welcome January, with your eyes wide open. Only with the money you can live without.


Source: The New Paper, Sat 27 Dec 2008

Don't worry about gurus of gloom

By Zhen Ming


WITH just 10 days left before New Year's Eve, the countdown to 2009 will soon begin.

It's time now for me to look ahead and make some predictions for the New Year.

And as I gently wipe the dust from my crystal ball, all I can see initially is the word 'recession'.

And then I can also see signs of cutbacks, layoffs - and pure worry.

That's because, for many, the future is frightening.

A record 63 per cent of Americans in a recent ABCNews/Washington Post poll, in fact, think the US is in a 'long-term economic decline'.

So how bad is it out there? And what's in store for us in 2009?

To find out, I scoured cyberspace to seek the views of three gurus of gloom:

Marc Faber

Known internationally as 'Dr Doom' , the Swiss-born investment guru is publisher of the Gloom, Boom & Doom Report. He once warned investors months before the so-called Black Monday crash of 1987.

Dr Faber recently made the following predictions on Bloomberg television:

'Next year, if the economy in the US is as weak as I think it would be... I think sovereign wealth funds are going to be very busy supporting their own markets, they won't have much money to buy assets around the world.

'The next emergency measure will be that Americans are not allowed to buy foreign currency and transfer money overseas, and the next measure will be not permitting Americans to buy gold and so on and so forth.'

Nouriel Roubini

Also known as 'Dr Doom' but more among Americans, the economics professor at New York University reputedly saw the 2007 mortgage-related meltdown coming - long before many of his peers did.

Dr Roubini this month made the following scary predictions in Fortune magazine:

'We are in the middle of a very severe recession that's going to continue through all of 2009 - the worst US recession in the past 50 years ...

'For the next 12 months I would stay away from risky assets. I would stay away from the stock market. I would stay away from commodities. I would stay away from credit, both high-yield and high-grade.

'I wish I could be more cheerful, but I was right a year ago, and I think I'll be right this year too.'

Gerald Celente

As CEO of the Trends Research Institute (a panel consisting of 25 experts with a variety of backgrounds), he is renowned for accurately predicting future world events such as the fall of the Soviet Union and the 1987stock market crash.

Mr Celente told Fox News late last month that, by 2012, America will become an undeveloped nation, and that there will be a revolution marked by food riots, squatter rebellions, tax revolts and job marches.

In a subsequent interview, Mr Celente also added: 'It's going to be very bleak. There is going to be a lot of homeless, the likes of which we have never seen before. Tent cities are already sprouting up around the country and we're going to see many more.'

Mr Celente, who also successfully predicted the 1997 Asian currency crisis and the sub-prime mortgage collapse, last year told UPI that 2008 would be known as 'The Panic of 2008', adding that 'giants (would) tumble to their deaths'.

Mr Celente's predictions have seemed to come true, what with the collapse of the likes of Bear Stearns and Lehman Brothers.

So how worried should we be by these dire warnings? Should we lose any sleep over their predictions?

To be sure, many banks in the West have had to be saved, asset prices have plummeted, and a recession is now hitting the global economy.

To be sure, we're now in a period of what economists call 'forced liquidation', which has happened less than 10 times in the past 150 years.

And yet, we're still around.

And yet, if you were take a good look around, the streets of Singapore are still full of flashy cars, our shops still full of food, and most of us are still gainfully employed and comfortably housed.

So let's shrug off our irrational shivers and instead look forward to 2009.


Source: The New Paper, Sun 21 Dec 2008

Worst 5 money predictions of '08


By Zhen Ming


HERE'S my pick :

1 Jan 2008

PREDICTION: According to the Chief Executive magazine's annual poll, US CEOs expect the Dow Jones Industrial Average to sit at around 13,359, oil prices to be at US$96 a barrel and US Federal Reserve funds rate to remain at 4.25 per cent by the end of 2008.

REALITY: Fast forward to Wednesday, and the Dow is still largely directionless at 8,824, oil prices are at a four-year low of around US$40 a barrel and Fed rates are now at near zero per cent.

Oil, which peaked in July at about US$147 in July, could even decline to US$25 next year - despite the OPEC production cuts.

2 Mar 2008

PREDICTION: Jim Cramer, the volatile host of CNBC's Mad Money programme, when responding to a viewer's e-mail, arrogantly asserted:

'Peter writes: 'Should I be worried about Bear Stearns in terms of liquidity and get my money out of there?'

'No! No! No! Bear Stearns is fine! Do not take your money out. ... Bear Stearns is not in trouble.

'I mean, if anything they're more likely to be taken over. Don't move your money from Bear! That's just being silly! Don't be silly!'

REALITY: Hopefully, Peter (the viewer put down by loud-mouthed Cramer) had the cow-sense to seek a second opinion.

Six days after the show's broadcast, Bear Stearns was sold for a pittance to JPMorgan Chase - after widespread speculation about the investment bank's massive exposure to subprime mortgage.

4 Sep 2008

PREDICTION: Donald Luskin, in his article 'Quit Doling Out That Bad-Economy Line' (appearing in The Washington Post), boldly proclaimed:

'Anyone who says we're in a recession, or heading into one - especially the worst one since the Great Depression - is making up his own private definition of 'recession'.'

REALITY: The day after Luskin's self-delusional forecast, Lehman Brothers filed for bankruptcy. And the rest is history.

5 Nov 2008

PREDICTION: Outgoing US Treasury Secretary Henry Paulson, on National Public Radio, prematurely bragged about the improved health of US banks:

'I believe the banking system has been stabilised. No one is asking themselves anymore, is there some major institution that might fail and that we would not be able to do anything about it.'

REALITY: Paulson, who emerged in October with a US$700 billion 'bazooka' to blast away toxic assets in troubled US banks, ended up acquiring direct equity stakes instead (a move he himself had rejected earlier).

Unfortunately for Paulson, shortly later, Citigroup's stock price plunged 75 per cent in one week - closing below US$5 for the first time in 14 years.

June 2007

PREDICTION: Dennis Blair and Kenneth Lieberthal, in their Foreign Policy essay 'Smooth Sailing: The World's Shipping Lanes Are Safe', declared:

'In reality the risks to maritime flows of oil are far smaller than is commonly assumed. Tankers are much less vulnerable than conventional wisdom holds.

Limited regional conflicts would be unlikely to seriously upset traffic, and terrorist attacks against shipping would have even less of an economic effect.

REALITY: On Wednesday, the United Nations said Somali pirates in inflatable rafts have made US$120 million ($175 million) in pirate attacks this year.

In two months, they had hijacked 30 ships.

The UN on Wednesday approved air and sea attacks on Somali pirate bases.


Source: The New Paper, Fri 19 Dec 2008

Another Ox Year, Another Baby Bust?

By Zhen Ming


THE proverbial stork now comes much later and on fewer occasions, too.

Not surprisingly, the size of the average Singapore family has shrunk sharply.

Among women 40 years or older who have ever married (that is, among those who are quite likely to have already completed their child-bearing) the average number of children has fallen continuously since the 1990s — this, despite a slew of generous procreation incentives introduced in recent years.

Singapore women in their 40s, for instance, gave birth, on average, to a total of 2.75 children in 1990.

But by last year, most of them would have experienced motherhood, at most, only twice in their lifetime (an average of 2.07 children).

(My own better half is in this category and we have two grown-up daughters.)

Dwindling dramatically

Even among the older generation (women 50 years or older), the average number of children has also dwindled dramatically — from 4.69 in 1990 to only 3.03 by last year.

Amazingly, despite a faster-growing population in Singapore since the start of the new millennium (arising chiefly from the influx of new immigrants), the number of locally-born children has stayed consistently below 40,000 a year since 2003 — when a serious SARS epidemic placed a big dampener on the local economy.

Earth Dragon high

This low birth rate situation in 21st century Singapore pales in comparison to the all-time high of 52,957 newborns in 1988, during the auspicious Year of the so-called Earth Dragon, when the Singapore economy was also on the up and up.

To be sure, with three-quarters of all Singaporeans still of Chinese descent, zodiac signs will likely remain an important consideration as to when many newlyweds should start their families (and when we can expect a bumper harvest of new babies).

More recently, however, the cyclical ups and downs of the Singapore economy have become equally important for the many married Singaporeans who remain childless by choice, especially during their first five years of marriage.

But what do oxen, tigers and dragons (plus nine other zodiac sign animals) have to do with when our newlyweds will take their first plunge into parenthood?

And how has this time-tested formula for family planning been rudely interrupted by the periodic economic dislocations that we’ve experienced since the mid-1980s?

Back in 1985 (a Year of the Ox, a beast of burden), when Singapore experienced the onset of its first full-blown post-Independence recession, there was widespread workforce retrenchment.

Lag time

But given the (ahem) unavoidable lag of about nine months between conception and birth, the sharp drop in new babies showed up only in the following year (which back then also coincided with an avoid-it-if-you-can Year of the Tiger).

A similar delay-parenthood-if-we-can pattern showed up in mid-1997 (another Year of the Ox) when the onset of the Asian currency crisis led to another sharp economic downturn (this time, on a much broader, region-wide, basis).

Not surprisingly, Singapore went through a prolonged two-year baby bust — starting in 1998 (another Year of the Tiger) and spilling over into 1999 — before the return of confidence and a new Dragon Year in 2000 (at the height of the dotcom boom) helped our newlyweds overcome their fears about first-time parenthood.

Short-lived boom

But this baby boom soon proved short-lived when the ensuing dotcom bust of 2001 and then (horrors) the subsequent SARS slowdown of 2003 all but ensured that the number of new babies thereafter would stay permanently below 40,000 a year.

And just when you think the worst is over, here we are, once again, about to set off for yet another economic (and family-planning) roller-coaster ride.

The Ox returns

With the onset of the global credit crunch in late 2008 — and with further economic uncertainties in store for us next year (another Year of the Ox!) — expect the next baby bust to last at least two years (inclusive of another Tiger Year!).

But if life is an ever-repeating zodiac cycle (like what most Chinese families think it should be), expect a rebound in new babies by 2012 (another Dragon Year).

That’s when, thankfully, you can also expect a full-fledged global economic recovery.


Source: The New Paper, Sun 14 Dec 2008

Pity if hidden gems remain hidden

By Zhen Ming


SWEDEN'S Prime Minister Olof Palme died in 1986 in Stockholm at the hands of an assassin.

Back then, his murder in the middle of Stockholm's downtown shocked the world. (Political assassinations, until then, were virtually unheard of in Scandinavia.)

Mr Palme was born into an upper-class, conservative family in Sweden in 1927. Nevertheless, he still required a scholarship to study at the pricey Kenyon College (my alma mater in Gambier, Ohio), graduating with a BA in 1948.

At Kenyon, Mr Palme was an excellent student, earning all As in his major subjects (economics and political science). He was also a member of Kenyon's first varsity football squad. And, like me, he washed the college president's car for pocket money.

After graduation, Mr Palme spent three months hitchhiking his way through the US with only US$300 (S$450) in his pocket.

Mr Palme later said that what he heard and saw on that US trip - the deep economic inequality and racial segregation - influenced his political and social ideals.

Around the time when Mr Palme was still prime minister of Sweden, one Barack Obama was enrolled, on a college scholarship, at Columbia University in New York City, where he majored in political science with a specialisation in international relations.

Mr Obama then graduated with a BA from Columbia in 1983 and later entered Harvard Law School in late 1988 (here again, on another college scholarship).

He gained national media attention when he was elected the first black president of the Harvard Law Review. And the rest, as they say, is history.

Seventeen years after graduating with a Juris Doctor magna cum laude from Harvard in 1991, Mr Obama is set to be the 44th president of the United States.

Generations of outstanding men (and women) like Mr Palme and Mr Obama have all benefited from the generosity of the privately-funded US higher educational system.

For years, it all seemed so simple - donations would first roll in, the booming stock market would then multiply them, and the college endowments would then swell.

At the wealthiest schools, the millions would become billions, and even small colleges (like Kenyon) would start to amass sizeable fortunes.

But with Wall Street's recent meltdown, all bets are off.

With most endowments predicted to plummet by 30 per cent this academic year, many US universities are downsizing or even shelving long-term plans.

Even the wealthiest schools - among them Harvard, MIT and Dartmouth - suddenly find themselves in the unfamiliar situation of trimming budgets and freezing hiring to offset heavy investment losses.

In September, Harvard University announced that its endowment, the country's largest, had risen to a staggering US$36.9 billion as of 30 Jun.

But just last week, in a stark sign of the economic times, Harvard said the value of its investments had plunged 22 per cent, or about US$8b, in the past four months. It anticipates a further 30 percent loss by next June.

Now, many other top universities worldwide (including those in Singapore), while declining to provide specifics, have also publicly acknowledged substantial losses.

My hope for 2009 - that this swift reversal of university fortunes won't hinder a future Olof Palme or another Barack Obama from maximising his or her potential.


Source: The New Paper, Fri 12 Dec 2008