Money Cannot Buy Happiness, Just A Different Set Of Problems – USDSGD

My friend, the Retired Trader, was giving me an analogy about a rich chap who is not happy (as opposed to unhappy) but mightily relieved at his own set of problems. Problems like which rims to settle for the new Ferrari – 20 or 22 inch, kids choice of university anywhere in the world etc.

It is true. When you are past basic worries, you still worry and I have seen folks do just that.

Singapore will have 4,878 the most ultra-high-net-worth individuals within a decade as its stature as a financial center increases with the region’s growth.

UHNW individuals are people with $30 million or more in assets excluding their principal residence and I am assuming most of them will be Singaporeans or PRs.

The wallet talks loudest in the world today. My son, having come back from a week long camp in Bintan, was recounting to me about a boy of Chinese origin carrying a wad of notes in his wallet, SGD, USD and IDR, possibly a thousand dollars worth and being really popular with the girls after treating a bunch of them to drinks.

Money is the new language so we cannot fault those who try too hard and fail as bankruptcies rise 14% for 2013 in Singapore according to a CNBC report.

And it is even harder to fault those who fail because costs of living spiral out of their control. In 2013, Singapore is the most expensive place in the world to buy clothes too.

What sort of dubious claim is that ? But I can attest that the iPad mini is at least 200 bucks cheaper across the Causeway, a simple 20 min bus ride (and soon MRT ride) away where dozens of Apple resellers have suddenly sprouted. And while you are there, might as well grab a dozen of those Krispy Kreme donuts for half the price of Singaporean ones.

To the main gist of my posting today. We need the millionaires and, in general, Singaporeans’ wealth depends alot on it.

Graph of FDI into Singapore vs USDSGD



Singapore, for its population of 5 million, attracts the same amount of FDI as Australia, 1/3 less than Hong Kong and 1/5 of China’s total FDI.

That is a hefty sum if you ask me with FDI at 1/5 of the country’s GDP ($274 bio in 2012).

If we look at the USDSGD chart versus the FDI, we can understand how the strengthening is automatic with or without the MAS and our SGD Neer.

I am supposing that foreign purchases of property in Singapore in the capacity of local incorporated entities would be included in the FDI number as well.

A paltry sum ? USD 56.6 billion in 2012 ? Not if we consider that the total FDI into Singapore, Malaysia, Indonesia, the Philippines and Thailand was just USD 128 bio for the year 2013.

Singapore has the lion’s share.

This is without considering the financial sector boost as banking assets are transferred over and managed out of Singapore, the boost on the property and retail markets from the increased spending and taxes, the services sector benefits as well.

GDP Breakdown By Sector

However, we do note that wealth does not translate proportionately to equivalent spending although the notional sum will typically exceed the average person’s expenses.

Wealth begets wealth. Singaporeans benefit from higher asset values and low interest rates as funds pour in.

Why are we back to the drawing board this year ?

The whole idea of the Singapore economy is to value add and we are running out of space. With Raffles Place valued at $3k psf, we cannot really push our luck too much further.


The people must continue to KEEP CALM, INNOVATE, CREATE VALUE and CARRY ON, besides hoping that the rest of the world will not catch up so that this little former fishing port can remain a safe haven oasis in the storm and a grand dream destination for the best and richest in the world.

Giving up is not an option because we really have nothing of value to sell except for our services (refer to GDP above and the manufacturing and construction components).

Thus with 2014 being a transition year, as I had expected back in Jan, USDSGD has not broken below 1.25 which was the average for 2013. This says we better start bracing for harder times ahead especially with exports holding on negative growth for most of 2013.

Graph : Non Oil Domestic Exports

singapore nodx

It is not worrying because the vision is to transform Singapore into a Silicon Valley, a space hub and a commodities and LNG hub.

We have the April monetary policy meeting coming up (2nd week of April) which will be a non event, I suspect. Thus USDSGD should drift in the 1.26-1.30  stalemate for the time being.


I am not optimistic the economy will deliver the astounding GDP results of our casino years, as yet. And given the mood on the ground amongst the general populace who are mostly quite wealthy but not happy or economically optimistic, I think its easier to call a buy on USDSGD going forward.