In our pursuit of knowledge, there is nothing more frustrating than ignorance and the inability to figure out what is going on.
No, we are not talking about the crazy market moves this week and how predictable it is to have a “face-saving” market rallies following the start of a trade war between the largest and second largest economies of the world. Nor are we talking about the World Cup and how the top 3 favourites, Brazil, Germany and Spain got the boot.
We are talking about our trusty car which flashed a drive stability error message and, because it now has a “brain” (CPU) of its own, would not budge whereupon the workshop promptly informed us that the Engine Control Unit had to be replaced. No, they did not think it was just a sensor problem, as we helpfully googled and suggested. 3 days later and 3 and a half thousand dollars poorer, with no physical evidence offered that the ECU was actually changed, we drove off feeling that familiar frustration with ourselves for our lack of understanding of the black box of auto mechanics, pretty much the same feeling as when we first attempted to understand Bitcoin and the block-chain.
Where can we find an honest mechanic nowadays ? They must be as hard to come by as the honest banker in the black box of finance, even if we find finance less of a black box than the new age cars and their circuitry that are designed to make fools of us and feel stupid enough to place our trust in the mechanic and there is no option to buy an old model because they don’t make them anymore.
We cannot go back to the simple old phones and the simple old cars that were easier to figure out and even if we got ourselves the universal fault code reader for 20 bucks on Qoo10 (the cheaper version of what workshops and mechanics use to figure out the problem with your car because times have changed and mechanics do not really know how the car works too), the workshop might throw a fit.
There is no denying that the number of black boxes are increasing rapidly in our lives as we move into the new age of the Internet of Things and increasingly have to entrust our ignorance in those black boxes as mechanics rely on those fault code readers to rip us off and nobody really knows how most things work without the help of Google, the most powerful source of mind control ever invented, as the new net neutrality rules allows internet providers to divert net traffic to the highest bidder.
On black boxes and trade wars, we cannot help but feel that we have come to one of those breathe-and-think moments for 2018, as we reflect on the events of the past week.
We Missed Buying Those Condos and Cars
We were too caught up with the idea of getting that fault code reader, we missed out most of the action of the week in sunny Singapore – the condos and cars (2 of the 5 C’s).
Yes, we saw that COE prices have fallen to new lows but we did not think of buying a new car this week, preferring to see how the US-China trade war plays out which will, hopefully, divert some cheap cars our way and also the impact of the new VES (Vehicular Emissions Scheme) that kicked in on 1 July.
Yet the car showrooms have been packed as we read on Thursday as folks juggle between the idea of buying cars and houses when the government decided to raise the ABSD (Additional Buyers Stamp Duty) and lower the LTV across the board.
Before we slag off the stupidity of these folks, or maybe just the car buyers, there is no reason to generalise that the 1,000 buyers (some foreign) represent the majority of our population of 5 million where only 79,000 own more than 2 properties.
The reasoning for real estate investment in land scarce Singapore is rather sound because it is seen as a long term store of value and there is a general perception that the MAS will never let interest rates go much higher than current levels and most people we speak are very confident that pegging home loan rates to DBS’s 9 month fixed deposit rate is a good idea because it has not gone up much above zero in the past decade.
Yet the authorities are right to be worried for the developers, banks and investors, as MAS MD Ravi Menon cautioned on the “euphoria” brought about by the en-bloc fever that has minted many a multi-millionaire.
Just this week, we had global cities seeing some negative real estate headlines.
- Greater Vancouver Detached Home Sales record weakest second quarter sales dating back to 1991.
2. Deflating Property Bubbles in Sydney & Melbourne. “Recent home buyers could be facing negative equity”: CoreLogic
Caught in their own game where they cannot raise interest rates, the authorities just decided to target the demand pool by taxing them and reducing their room for leverage, and in good speed too, because it now seems certain that trade wars have begun on 6 July 2018 and this would be the biggest one in economic history, for all the entertainment we derived from watching the progress of that ship loaded with soy beans making a beeline for Dalian port (and failed to make it by midday).
And MAS is right to warn “dire” consequences if trade risks spread, although it is still too early to say.
Source : Bloomberg
This is because Singapore is one of the countries in the world most exposed to global trade, according to the WTO.