Singapore Savings Bonds

[reddevil0728]

Agree on the answer tailored to specific question point. Not every question can be answered with Google search... this is what a discussion board is for.

Definitely not every qns can be googled.

but it’s those that can be, that ought to be told how to fish

 

[Moowoow]

Today (29 Jun 905am) ST published news article on SSB 2.71% "highest since 2015" .. luckily they only published after applications closed.. otherwise maybe maybe everyone will get less than $18k...

Singapore Savings Bonds 10-year average return hits 2.71%, highest since 2015

The 10-year average return for the July issue soared to 2.71%, just short of its last peak in November 2015. Read more at straitstimes.com.

www.straitstimes.com

But with this fresh publicity and the 3% rate (or 2.999), I doubt I will get $18k next month,.

People who got more than $18k to deploy don't need to wait for SSB. Just keep $18k for the next SSB, and find something else to invest in for the rest. I managed to buy some Astrea V at face value ($1) on Monday.

Looking at how fast it is building up the reserves account, I am happy to buy more at $1. But Liquidity is so low, pls don't follow me and bid up the price, thanks!

Does 200k apply to t bills

 

[Jov1623]

Does 200k apply to t bills

No

 

[lzydata]

Today (29 Jun 905am) ST published news article on SSB 2.71% "highest since 2015" .. luckily they only published after applications closed.. otherwise maybe maybe everyone will get less than $18k...

Singapore Savings Bonds 10-year average return hits 2.71%, highest since 2015

The 10-year average return for the July issue soared to 2.71%, just short of its last peak in November 2015. Read more at straitstimes.com.

www.straitstimes.com

This article is very strange, reporting 2.71% as news even though the rates were all announced on 1 June, and after the application period for the same SSB closed so that any reader cannot do anything about it. But it is fine since MAS had already published an announcement of the rates in the newspaper.

Zaobao seems more familiar with SSB and what is going on. The real news was the record amount applied, and the next SSB to come.

 

[havetheveryfun]

This article is very strange, reporting 2.71% as news even though the rates were all announced on 1 June, and after the application period for the same SSB closed so that any reader cannot do anything about it. But it is fine since MAS had already published an announcement of the rates in the newspaper.

Zaobao seems more familiar with SSB and what is going on. The real news was the record amount applied, and the next SSB to come.

not strange la.. just reporter trying to clock his article count haha

 

[BBCWatcher]

Periodic reminder: nominal interest rates don't matter. Only real interest rates do. Singapore dollar inflation is running at 5.4% at last report (Singapore's CPI, April to April, year on year). If Singapore dollar inflation is similar or even fairly substantially lower than the last reported annual inflation rate then the next SSB (and current SSB) will have negative real interest rates.

Yes, OK, if you're using (a reasonable amount of) SSBs for emergency cash reserves (for emergency month #2 onward), that's fine. And/or for a specific large spending objective a couple years from now, such as a down payment on a home or a university tuition bill. A less negative (but still negative) real interest rate might be the best you can do in these circumstances. But SSBs are NOT designed to be long-term investment vehicles. Even the government will tell you that.

I was much more excited/interested in SSBs at slightly lower nominal interest rates back circa 2019, and I told you so in so many words. Those were better deals with about 3 years of low inflation ahead, still for the roles that SSBs are designed to play. Today? "Eh." Nominal rates are "high" precisely because inflation expectations are "high." I think we'll see that 5.4% inflation rate come down, but if forced to predict I think it'll come down fairly slowly. (I could be wrong, of course, but that's my current forecast.)

 

[reddevil0728]

Periodic reminder: nominal interest rates don't matter. Only real interest rates do. Singapore dollar inflation is running at 5.4% at last report (Singapore's CPI, April to April, year on year). If Singapore dollar inflation is similar or even fairly substantially lower than the last reported annual inflation rate then the next SSB (and current SSB) will have negative real interest rates.

Yes, OK, if you're using (a reasonable amount of) SSBs for emergency cash reserves (for emergency month #2 onward), that's fine. And/or for a specific large spending objective a couple years from now, such as a down payment on a home or a university tuition bill. A less negative (but still negative) real interest rate might be the best you can do in these circumstances. But SSBs are NOT designed to be long-term investment vehicles. Even the government will tell you that.

I was much more excited/interested in SSBs at slightly lower nominal interest rates back circa 2019, and I told you so in so many words. Those were better deals with about 3 years of low inflation ahead, still for the roles that SSBs are designed to play. Today? "Eh." Nominal rates are "high" precisely because inflation expectations are "high." I think we'll see that 5.4% inflation rate come down, but if forced to predict I think it'll come down fairly slowly. (I could be wrong, of course, but that's my current forecast.)

yes nominal interest rates don't matter, but real interest rates do.

but unless and until real interest rates get published, looking for the highest nominal interest rates is what matters.

 

[lzydata]

Yes, OK, if you're using (a reasonable amount of) SSBs for emergency cash reserves (for emergency month #2 onward), that's fine. And/or for a specific large spending objective a couple years from now, such as a down payment on a home or a university tuition bill.

Oh good, so SSBs do get your approval for some situations. I am sure everyone is thankful to read that.

 

[BBCWatcher]

Oh good, so SSBs do get your approval for some situations. I am sure everyone is thankful to read that.

I'm just commenting on the basic math, lzydata. People can do whatever they want to do as long as it's legal, but the basic financial math will determine the outcome of financial decisions. That's important to remember.

I hold some SSBs, so obviously I'm not opposed to them. But I also know what they are: not very good right now! All SSBs are currently losing real purchasing power, and (call me crazy!) I don't get excited about that. Sorry to rain on this parade, but some rain is deserved.

 

[hyperfuse]

I'm just commenting on the basic math, lzydata. People can do whatever they want to do as long as it's legal, but the basic financial math will determine the outcome of financial decisions. That's important to remember.

I hold some SSBs, so obviously I'm not opposed to them. But I also know what they are: not very good right now! All SSBs are currently losing real purchasing power, and (call me crazy!) I don't get excited about that. Sorry to rain on this parade, but some rain is deserved.

yup ssb losing real purchase power but its better than putting in a tin can or a bank.

stocks also losing money and there is no guarantee that ppl buy the dip now, they can reap profits later on whereas SSB is a sort of guaranteed that you will get profits.

The past history performances of stocks, etf and what else doesnt mean the future will follow the past trend too also.

Because to be so anal about all this miniscule stuff, i can also say the time spend of someone typing in hardwarezone forum can be use to earn money elsewhere. So the time on hardwarezone is "losing purchasing power too" because it could actually use to earn more money hehe.

 

[reddevil0728]

I'm just commenting on the basic math, lzydata. People can do whatever they want to do as long as it's legal, but the basic financial math will determine the outcome of financial decisions. That's important to remember.

I hold some SSBs, so obviously I'm not opposed to them. But I also know what they are: not very good right now! All SSBs are currently losing real purchasing power, and (call me crazy!) I don't get excited about that. Sorry to rain on this parade, but some rain is deserved.

How did you deduce that you are raining on the parade?

Like you said, you are holding some SSBs, so others who are also holding some SSBs like you are just chasing the highest interest rate they can get for the some SSBs they want to hold.

Is that basic financial math?

 

[stephenbishop]

Because to be so anal about all this miniscule stuff, i can also say the time spend of someone typing in hardwarezone forum can be use to earn money elsewhere. So the time on hardwarezone is "losing purchasing power too" because it could actually use to earn more money hehe.

Very true and seriously funny....

 

[BBCWatcher]

yup ssb losing real purchase power but its better than putting in a tin can or a bank.

That's true! SSBs are outperforming ordinary Singapore dollar bank deposits, fixed deposits, and cash in a can. SSBs are slightly less liquid, though (maximum 5 weeks to withdraw). If the reduction in liquidity is acceptable then SSBs can be comparatively attractive.

stocks also losing money and there is no guarantee that ppl buy the dip now, they can reap profits later on whereas SSB is a sort of guaranteed that you will get profits.

No, SSBs are only nominally guaranteed by the Government of Singapore. You (the SSB holder) assume ALL omnipresent inflation risk, and future inflation over your holding period will determine the real outcome. You could come out ahead, even, or behind — even well behind. All those outcomes are entirely possible with SSBs.

The past history performances of stocks, etf and what else doesnt mean the future will follow the past trend too also.

Likewise, the past Singapore dollar inflation rate is not necessarily indicative of future results. Nobody is offering any real outcome guarantees here, sorry to say. SSBs (beyond reasonable Paragraph #1 holding amounts) are wagers in favor of low Singapore dollar inflation (i.e. wagers against moderate or high Singapore dollar inflation).

By the way, we should get another month of inflation data from Singstat before the next SSB's purchase deadline. We should also get the next SP Services quarterly electricity rate tomorrow (July 1), and we already know there's some more Singapore dollar inflation baked in with the successive GST hikes for the next 2 years. So we'll get a few more clues about inflation going forward, but it's still an uncertain wager.

Because to be so anal about all this miniscule stuff, i can also say the time spend of someone typing in hardwarezone forum can be use to earn money elsewhere. So the time on hardwarezone is "losing purchasing power too" because it could actually use to earn more money hehe.

A 5.4% inflation rate is not "anal" or miniscule. It's basically the whole ball game, actually. Reality is reality.

 

[jayou8]

I'm just commenting on the basic math, lzydata. People can do whatever they want to do as long as it's legal, but the basic financial math will determine the outcome of financial decisions. That's important to remember.

I hold some SSBs, so obviously I'm not opposed to them. But I also know what they are: not very good right now! All SSBs are currently losing real purchasing power, and (call me crazy!) I don't get excited about that. Sorry to rain on this parade, but some rain is deserved.

Just reading an article on "Strategists see lower returns as economy mirrors 1970s". If anything similar to 1970s, stocks and bonds might have similar poor returns against inflation.

the Dow Jones Industrial Average, which was just above 800 at the start of the 1970s, had only advanced to about 839 by the end of the decade, an overall gain of 5% over this 10-year period. Furthermore, when adjusted for inflation, stock market investors were down about 49% over the course of the decade.

Firstly I am not saying we will be like 1970s. But I would like to find out what excites people now to put their money to beat inflation. The article did mention the below and so I think sex is not the answer here.

The 1970s was fun. Way more fun than now. There was an astonishing amount of sex,” said Ferguson. “There was actually a very rigorous study that was based on multidecade surveys which proved conclusively that there has never been a generation that has had more sex than the generation that was born in the 1950s.

 

[reddevil0728]

Very true and seriously funny....

Ya savage also haha

 

[sgbird]

Quite sad to see useless argue here. I would say we are all adults and we take the responsibilities for what we buy. Blindly following is a not the fault of financial product but the nature of human characteristics.
In this thread most ppl come here for checking when to buy SSB, how to buy SSB and where to check SSB. Not to argue SSB is worthy or not

 

[reddevil0728]

That's true! SSBs are outperforming ordinary Singapore dollar bank deposits, fixed deposits, and cash in a can. SSBs are slightly less liquid, though (maximum 5 weeks to withdraw). If the reduction in liquidity is acceptable then SSBs can be comparatively attractive.

No, SSBs are only nominally guaranteed by the Government of Singapore. You (the SSB holder) assume ALL omnipresent inflation risk, and future inflation over your holding period will determine the real outcome. You could come out ahead, even, or behind — even well behind. All those outcomes are entirely possible with SSBs.

Likewise, the past Singapore dollar inflation rate is not necessarily indicative of future results. Nobody is offering any real outcome guarantees here, sorry to say. SSBs (beyond reasonable Paragraph #1 holding amounts) are wagers in favor of low Singapore dollar inflation (i.e. wagers against moderate or high Singapore dollar inflation).

By the way, we should get another month of inflation data from Singstat before the next SSB's purchase deadline. We should also get the next SP Services quarterly electricity rate tomorrow (July 1), and we already know there's some more Singapore dollar inflation baked in with the successive GST hikes for the next 2 years. So we'll get a few more clues about inflation going forward, but it's still an uncertain wager.

A 5.4% inflation rate is not "anal" or miniscule. It's basically the whole ball game, actually. Reality is reality.

The point is, you are giving good info, keep it at that.

but your delivery needs refining, I.e., don’t talk down to people with the “I know better than thou” kind of attitude. Rubs people the wrong way when you keep hitting on the same point as if people don’t know.

Is not like people writing in this forum is writing legal paper that requires such precision to hedge that they know is about real interest in all the post they make

 

[reddevil0728]

Quite sad to see useless argue here. I would say we are all adults and we take the responsibilities for what we buy. Blindly following is a not the fault of financial product but the nature of human characteristics.
In this thread most ppl come here for checking when to buy SSB, how to buy SSB and where to check SSB. Not to argue SSB is worthy or not

Some people just want to give the “I know better than thou” kind of rub down

 

[CaptainWu]

People who got more than $18k to deploy don't need to wait for SSB. Just keep $18k for the next SSB, and find something else to invest in for the rest. I managed to buy some Astrea V at face value ($1) on Monday.

Looking at how fast it is building up the reserves account, I am happy to buy more at $1. But Liquidity is so low, pls don't follow me and bid up the price, thanks!

I queued Astrea V at lower price (0.996/7) last week and could'nt get it and now the price rise recently!

 

[stephenbishop]

Firstly I am not saying we will be like 1970s. But I would like to find out what excites people now to put their money to beat inflation.

I guess that depends on one's risk appetite and investment time horizon?

If one believes high inflation will be with us at least for the next 2 or 3 years (which I do not), and one has a long enough investment horizon (which also I do not), then the commodities and energy sectors may be exciting. However, if one also believes that the high inflation would be accompanied by low growth (i.e. stagflation), even these sectors would not be very exciting. Real estate and real estate related equity securities may be a good hedge but not particularly exciting.

For me a big portion will remain in cash and short term SGS given my risk appetite and investment time horizon.