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Is CPF a PONZI SCHEME?

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Old 26-04-2011, 10:18 AM   #16
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well.... like my dad put it in his rather straightforward way

if he was to retire and just nua at home, he will get sick very quickly.

As long as you are mobile, mentally active then you should go and do something. Even my neighbour who retired and is recovering from a bout of throat cancer is driving a cab...

he just wants to hit target (profit 100 dollar) and then call it a day. And he gets there rather easily on the good days. He can be at home shaking leg and playing with grandaughter by noon...

while I heard of another case of taxi driver but keeps going home to rest when he hear got traffic jam on radio.... while he seems to be in one place all the time...
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Old 26-04-2011, 12:59 PM   #17
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Some of the mentioned Economist reads. Not Gospel but should be worth more than the stuff being thrown around in TemasekReview.com I reckon.

http://www.economist.com/node/185295...ry_ID=18529505

Pensions

70 or bust!
Current plans to raise the retirement age are not bold enough
http://www.economist.com/node/18433194

A nudge and a wink
How to persuade employees to provide for their old age
http://www.economist.com/node/18502005

Too much, too young
Watch your wallets: the baby-boomers are beginning to retire

ps note that Economist has some kind of reading limits for non-subscribers. I think it could be 10 articles or so per a certain period before it locks down and gently asks you to subscribe. So don't suka suka click over all unless you are ready to sit down to read.
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Old 26-04-2011, 02:13 PM   #18
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I just found out from my friend, who is a finance professional, the meaning of PONZI SCHEME. We discussed the case of SUNSHINE EMPIRE where the boss ended up being charged.

Basically a PONZI SCHEME is an investment scheme that doesn't actually make money from investmetns. Rather, it takes money from later investors to pay to earlier investors (with returns + capital) to create the impression of high returns from "investment".

My first question was: IS CPF A PONZI SCHEME?

No one actually knows where our CPF money is going since they don't publish details of accounts. But we KNOW that they lost billions of our CPF money in overseas investment such as Suzhou, Hangzhou, Shin Corp, Merrill Lynch, Standard Chartered Bank. In fact, they even admitted that there was a lost.

So, if they are actually LOSING money, then where are they getting the money to pay out when people withdraw their CPF at age 65??

Answer: from the contribution of CPF "investors" who are younger. Who in turn get "reimbursed" by younger generations later on etc.


So the thing is, is THIS WHY they are increasing the CPF withdrawal age from 62 to 65, to delay payouts???


Second thing, is THIS WHY they are SO concern with the 'greying population', because in a few years time there will be MANY more people withdrawing their CPF with not enough funds injected from the younger generation?? And they have to fight this problem by getting in FTs to becoming Sinkies to bolster the CPF fund??? In order to pay out those older ones who turn 65??

Thirdly, is this a SKELETON IN THE CLOSET which is why they are so frightened of oppositions coming into power, to the point that LKY threatened to send in the army in case of a "FREAK RESULT"??


Answers are desired please... anyone can comment?
CPF is not ponzi, but CPF Life is in a way. Think abt it..........
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Old 26-04-2011, 02:29 PM   #19
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You do realize that in Singapore (well anyplace really), the government can simply create more money to pay you? You are getting it in SGD, you know? What's a little more inflation between the state and the people?

That was said in a joking tone, but it is really no joke. That is why government debt is different from say, the debt of a company or personal debt. The government can simply create more currency to pay it off.

If you are willing to take it.

Therein lies a very, very good reason not to do this. Perhaps some other peeps who are well-versed in economics and finance will come in and talk about it.
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Old 26-04-2011, 03:19 PM   #20
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oh not the print money to spend method....

you do not see the USA improving their balances with this move do you?
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Old 21-02-2012, 11:44 AM   #21
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i am goign to tell u a fact. Ponzi like schemes are common anywhere a financial entity is involved

Madoff's Ponzi schem itself was inspired by ofiicial financial entities
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Old 21-02-2012, 12:05 PM   #22
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i am goign to tell u a fact. Ponzi like schemes are common anywhere a financial entity is involved

Madoff's Ponzi schem itself was inspired by ofiicial financial entities
Any reason why to dig on a Apr 2011 thread out ?
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Old 21-02-2012, 04:06 PM   #23
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I just found out from my friend, who is a finance professional, the meaning of PONZI SCHEME. We discussed the case of SUNSHINE EMPIRE where the boss ended up being charged.
Why dont ask your finance professional?

If he is a finance professional and in investment industry, he should give you an idea of how a portfolio works. Not every single investment in a portfolio need to make money. Of course, if one can do that, he will be a legend. Even WB can't ensure that all his investments make money. There are no such things as sure win investment.

What they need to do is to ensure that portfolio generate a returns that is higher than for the paid out of the CPF interest through various form of investment instrument.
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Old 21-02-2012, 04:47 PM   #24
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What they need to do is to ensure that portfolio generate a returns that is higher than for the paid out of the CPF interest through various form of investment instrument.
correct, by pure mathematics it can be done and has been done. seen at least 2 already.
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Old 21-02-2012, 05:03 PM   #25
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Any reason why to dig on a Apr 2011 thread out ?
haha he too free ma. This thread makes me wonder what will happen if temask become lehman brother. GLC become AIG and MAS become merril lynch. hoseibo. then you see some people will take private jet fly to some remote island in central america. even big big banks and conglomerate can fall, i dun think any company can be always on it feet forever.
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Old 21-02-2012, 05:10 PM   #26
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Im lazy to read but I feel every where , every gov in every countries work like this ~

"They" the powerful rich finanical elites lay down this system which EVERYONE must follow ~

you have to trace back histories of why there are currency ~
who are rothschild families ~

blah blah blah ~
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Old 22-02-2012, 11:58 AM   #27
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I believe the answer is both yes and no
It is not a ponzi scheme outright but it works like a ponzi scheme because the fresh funds contributed from the working community will be paid out to the withdrawing community. This is because their investments are usually quite long term and it is impossible to en-cash that investment just to raise the funds to pay out to every individual retiree.

However, we can only speculate at what CPF does with our money... they do not offer transparency with their operation...
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Old 22-02-2012, 01:12 PM   #28
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if you read Hyman Minsky's financial instability hypothesis, he suggests finance has three types - hedge (stable), speculative (risk-taking) and ponzi (unstable) - and the degree of debt within the financial system is the determinant of these three types.

Certainly if CPF is in fact owing excess due to loss, it will enter the ponzi finance category, but we cannot know because govt keeps it absolutely hush hush anything to do with our reserves. Even our president not allowed to know
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Old 22-02-2012, 01:30 PM   #29
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However, we can only speculate at what CPF does with our money... they do not offer transparency with their operation...
All their money is invested in SG Government Bonds that are guaranteed by the SG Government using the Nation's Reserves. Currently the SG reserves > CPF amount.

http://app.mof.gov.sg/data/cmsresour...20Overview.pdf
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Old 22-02-2012, 01:56 PM   #30
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All their money is invested in SG Government Bonds that are guaranteed by the SG Government using the Nation's Reserves. Currently the SG reserves > CPF amount.

http://app.mof.gov.sg/data/cmsresour...20Overview.pdf
Bonds are a form of debt, albeit a relatively safe one from an individual's perspective. Debt owed by our own government, however, means that it is ultimately safe because our government can tax or inflate its way out of debt - which is a losing proposition for the citizen, who happens to also be the individual "investing" in the bond indirectly. So the amount of risk borne by the citizen is "safe" from a micro individual point of view, but enormous from a macro perspective based on how the government uses its loans (aka bonds) for. And for these purposes we are not even allowed to know, nor is our President.

TLDR: $inkies are $toopid.
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