Friday, April 27, 2007

....and then I became a MILLIONAIRE!!!

It must have happened sometime last month when the bulls were charging on the stock market. My stock portforlio is well over $1M when I checked it yesterday. Not that it is a big deal since Singapore produces the highest number of millionaires per capita. They are not talking about millionaires these days but multi-millionaires. Somehow the millionaire making machine got to me. I assure you that I didn't do anything smart or extraordinary. I do have a slight interest in economics and spend about an hour during the weekends to go through a few investment magazines. Whatever it is, I'm no 'genius asset allocator', I got LUCKY. In life better not mistake luck for skills. Even if I'm smart, these are still outsized rewards for being smart.

The first people I've to thank is the PAP govt. They have created low tax an environment in which corporations thrive. Corporate profits as a % of GDP is at its highest in history and the govt still feels that it is not enough - they have to cut corporate taxes. This will help the CEO who made $1M last year make $2M this year - not that he got smarter or worked harder, the environment has improved, profits goes up....he too will get lucky. St. Regis is sold out. Yachts makers are reporting backorders of up to 1 year. The Mercedes salesman never had it better.
If you go ask them, they will say they deserve it, they worked hard, they worked smart but the reality is corporate profits are rising because labour cost of the bottom 30% of our workforce has remained stagnant to produce these profits. If that is not the case, why hesitate to implement minimum wages, why remove retrenchment benefits, why open the floodgates to foreign labor. ...if it has no impact on profitability.

Government set the moral tone when it comes to renumeration. If a govt comes out to say they deserve to be paid 4000 times cleaner, they set this example for the CEOs and high income earners to follow....they too will feel the deserve more. So do you think a CEO works 4000 times harder & smarter than the cleaner? ...does he carry around with him the brain the size of an elephant? Economic systems from time to time can become downright bad at distributing incomes like now and before the French Revolution. They are rescued by men like Warren Buffett & Bill Gate who will be setting up the largest foundation to distribute their all their wealth. ...Warren Buffett once said that he is probably smart but the market has over-rewarded him for his asset allocation skills, it is ridiculous for him to be a billionaire for allocating capital....so he is giving it all away. It is the job of govts to fix the system when such huge distortions occurs not stand around and say it is due to globalisation....

When it comes to setting the right moral tone in our society, nobody can even come close to the PAP, they operate a 4 trillion$ economy for only $40M. I'm sure after this minister pay episode, many of our multimillionaires and billionaires will see their conscience awakened and realise their success is due as much to the favorable system/environment as their own efforts. Just like Li KaShing, they will stand up to pledge to give away a significant proportion of their wealth. Singaporeans are so lucky to have unselfish people in govt who set the example for the rest of the well endowed to follow....

19 comments:

Anonymous said...

Dear lucky tan,
being such a devout PAP follower, i'm sure you too will set an example by leaving your $1 million assets not to your sons and daughters but to the cleaners who clean your estate and the taxi drivers on whom your live depends on everyday.

i'm sure that being the magnanimous, benevolent and intelligent (hey you're the one with the mensa membership!) person you are, you'll want to follow the example of our equally magnanimous and benevolent PAP government and give away your assets.

LuckySingaporean said...

anon,

Of course! I still take the bus you know - I gotten used to it. I've no desire to move into a landed property because I like my apartment which I've almost finished paying. I don't play golf and feel that it is a waste of precious land so I don't need a club membership. The food I enjoy most are the steamboat buffets that cost no more than $15. I don't intend to upgrade to imperial crusine. I fly budget and my favorite tours are to SE Asian countries.

There is nothing in my life that needs this million dollars. I intend to give some of it to the people close by who are needy and have done so before. I don't intend to leave any nephew or nieces if it undermines their work ethics. My parents have the same attitude towards money as me, if I give to them, they will say "Give it to me for what?! Can't find people more needy to give it to..?!". My siblings have more money than me so it is not necessary.

Most probably I'll find some charities who will be able to make good use of it. However, the million is probably negligible in the large scheme of things ....nothing remotely close to what we will need to take care our fellow Singaporeans in the coming years. I'm sure our beloved govt with its vast resources and billions in reserve has all along planned to distribute it. Because even Li Ka Shing as a private citizen is giving it away, there is no justification for govts to accumulate such vast amounts when a section of its people are suffering - like that we might as well let the likes to Li KaShing make the money..and give it away. But the PAP is benevolent, kind and loves us that is why the majority voted for them time and again. They are not taking all our money to so that selected elites can play fund manager to earn high salaries - it is their intent to give it back to the people.

Anonymous said...

Er, Mr Tan

you not going to follow the PAP, right?

Give with the left hand and take back double with the right?!

Bart JP said...

Lucky,

Congratulations on your new found wealth. But I have 1 comment. A few months ago, when the STI was at 2800, you advised people to exit the market. The evidence is here:

http://singaporemind.blogspot.com/2006/11/pop-champagne-3-cheers-to-stock-market.html#links

Now STI is at 3400, your portfolio crossed a million? How can you explain that - you mean you continued invested in the market? Hope no one followed your advice back then, they would be cursing at you now!

Anonymous said...

To anon 12:15pm

Lucky Tan will not give any $ to the needy as it will undermine their work ethnic, cause them to be lazy and worst, retire before 70 year old. This is against Lucky's favourite PAP ways.

Most importantly, since there is no minister giving all their $ away to the poor, Lucky will not do likewise as he always follow the leaders'fine example.

LuckySingaporean said...

Bart,

Gee the market turned out more efficient that I imagined. I got the entry point right but the exit was tricky. I lost $60K hedging my entire portfolio with put options thinking hedge funds will attack the US$. They expired worthless by Jan 2007....If not for those puts, it would have been slightly earlier.

Like I said, it was due to LUCK not any kind of God given skill. Past Nov 2006, I wondered everyday when the market was going to turn down. It defied all my experience. Yes, I got beaten by the EMH.

I had to hedge with puts because my portforlio had numerous stocks.
Strangely the puts (mostly HSI)would have been worth something had they expired in Feb 2007 when the sell down occurred...and my portforlio depreciated without any downside protection. I was disgusted not to mention humbled.

Anonymous said...

You make $50k a year and yet saved enough to have a $1 million portfolio. Wow.

I think you should write a book!

NoName

Anonymous said...

http://www.mycarforum.com/forum/Others_C20/Lite_&_EZ_F15/HP_staff_died_due_to_over_work!_P1854917

Pass it on

Anonymous said...

gosh, are they saying that the wealth generated was more "circumstantial" than the result of an EXTRAORDINARY intelligence? are they hinting of an undeserving and unjustifiable tax deducted income?

Anonymous said...

it is like a prayer; you close your eyes and hands, you see gods and paradise. but once you opened your eyes and the hands unclasped, you see golden chips and paradice.

that's why we are christmas trees all dressed up in foreign currencies, praying and praising in the house.

Anonymous said...

hi Lucky do you have an email where i can write to?

=)

LuckySingaporean said...

anon,

No problem, you can reach me at sgmedicalbills@yahoo.com

If it is not too irrelevant to the topic, why not post it here as comments.

Anonymous said...

I think the previous Anon wants to email you privately to ask for a loan.

Please let us know if you are offering free financial assistance, Lucky Tan!

Anonymous said...

goodnews today. the council of national obsession with more goals has recently announced their ambitious plan to rejuvenate the national team.blessed with an extraordinary foresight, they are now addressing a worrying trend of their national players exiting for better overseas offers and prospects. the other embarassing problem faced is that the players inability to keep stock of themselves and or kicking the bucket in the game. as usual, a multimillion dollar task force has already hatched a brilliant plan to tackle this ballistic problem. older players can now look forward to more challenging dribbles, enduring chases and their continue run after balls, for the amusement of well paying spectators, into their sunset years instead of bird watching in botanical garden.
be assured, your alzeimers, parkinsons and cricking joints will not be an impediment to more glorious goals.

part time cleaner said...

ok ok. i see lucky very lucky. but no forget, no lucky gormen no lucky today. gormen god luck we all got luck. gormen no luck we all no luck. good luck gormen than can make luck so lucky got lucky in stocks. i not rich like lucky play stock but because got good gormen bring luck and bring us toto, i can also try luck in toto. you see, lucky rich play stocks, cleaner like me also lucky can play toto and can get rich one day. everywhere got luck here if open eyes see, we all very lucky people only because gormen lucky and bring us luck. praise the gormen luck and people luck.

Anonymous said...

heng you didnt mispell luck...hahaha

Anonymous said...

Lucky Tan might not have been so Lucky to predict the exit point correctly, but hor, his observations about our exemplary pap are spot-on!

Read Lucky Tan's blog and it will open your eyes wide wide to the ongings in our beloved sillipore.

Anonymous said...

come on loser, stop your continuous bragging about your investment. loads of people do better than you. stop using your blog her eand in sammyboy to brag and brag about your portfolio allocation. it is disgusting

Anonymous said...

to anon 3.39pm, dun forget our Lucky is a *huge* pap supporter. he is trying to show how his investments are growing splendidly, just like lky did brag abt his own gic investments.

just like for Lucky Tan's investment returns, you will never get to enjoy gic returns.

sour grapes, pls stay away. LOL