TR EMERITUS

Original Blog by Goh Meng Seng HERE 今天接到两封由同样一人所发的电邮。第一封说有关当局不允许他的艺术团体运用艺术剧场“电力站”举行中国一 九八九年六四事件的纪念集会。我本身就笑着回电邮说报业控股的早报不久前举行了五四运动纪念会，还请了中国学者来大谈以往行动党大力打击的“共产党恐怖分 子”头目，中国共产党 (Chinese Communist Party) 创始人之一的陈独秀，如今却对六四纪念活动如此畏惧！难道行动党现在只允许唱好以往憎恨入骨的“共产党恐怖分子”而不许人民数落这“ 共产党恐怖分子”的六四屠城的历史事实吗？ 过了不久，这人又来一封电邮，说有关当局改变了原来的决定，有关活动可以继续在“电力站”举 行。这活动其实是全世界同步举行的纪念六四的活动，所以我们预计有关当局可能考虑到会引起国际社会的议论，所以才改变主意了。再说，主办者也在接到第一道 “圣旨”后，便立即申请到芳林公园演说者角落举办有关活动。如果把这纪念六四的活动搬到户外，可能会有更大的“杀伤力”！ 其实对我来说， 拥有不同理念的政治人物并不代表他们就是牛鬼蛇神，是什么“恐怖分子”。在许多民主国度里，他们也允许共产党参与他们的民主大选，这包括日本和许多欧洲国 家。甚至美国还是允许信奉共产主义的政党注册为正式的政党。民主制度本来就是多元化和具有非常有包容性的特质。 但是，就如我教我的女儿一 样，不要只认为当“兵”的就是好人，当“贼”的就是坏人。不要以这种简单的标签来评定人的好坏，而是要看看他们的言行和作为。最基本的就是要公正无私、公 平、合情合理，还有要有正义感，才能裁定一个人的好坏。所以共产主义也好，资本主义也好，不管任何人打着什么旗帜，最重要的就是要认清每个人的真伪。 可 是，我们最起码应该做到的是，认真面对我们的历史。是非对错，都必须以真实的心去感受、体会和认知。一个民族，一个国家，一个人民都必须有正视历史过错的 道德勇气才能使他们的文明得到进一步的升华。每一次日本人试图篡改历史，扭曲历史事实时，我们亚洲人，尤其是中国人民都会很愤怒。如果他们坚持“没有南京 大屠杀”的话，我想许许多多的中国人，那些经历过日本侵略的人和他们的后代都会大声抗议。但是如今在中国，甚至香港都会有人说“六四没有流过一滴血”，那 么我们这国际社会是否也应该群起抗议这完全藐视历史事实的荒诞谬论呢？ 我们姑且不论六四学生运动的对与错。任何有血性，理智和头脑清醒的人都会得到同样的一个结论，当权者用军队，冲锋枪和坦克大炮去对付手无寸铁的学生，这简直是冷血屠杀！这连小孩子都会认为不正确的事情，怎么还会有人去千方百计狡辩呢？ 其 实，从以往到现在当权者试图掩饰、漂白，甚至不让新一代中国人去真正认识这段丑陋的中国历史，我们便不难发觉其实他们是心虚！他们跟日本人一样心虚！只有 心虚的人才不敢说真相，勇敢地面对他们的历史过错。有位中国朋友说得好，日本在南京大屠杀和中共在天安门广场六四屠城是有很大的分别。日本人当时是侵略 者，他们是敌人对中国人民做出屠杀恶行，但是中共是以“人民解放军”去屠杀自己手无寸铁的中国人！这是多么的讽刺啊！ 中国共产党也是由学 生运动斗争起来的，但它却用连袁世凯和国民党蒋介石都不敢用的屠杀式的镇压手法去对付自己中国人民！这是中国共产党员必须认真面对的历史事实，正视它的罪 恶和自我检讨它在这几十年执政里所犯的最严重过错。其实我相信许多人，包括受害者的家属只需要中共中央承认这个政治错误判断，平反六四运动，就是这么简单 而已。以前文化大革命的受害者更是无数，也不只是一个平反，一个正视历史错误的检讨便能安抚许许多多的中国人吗？ 再说，一味把学生运动说成外国帝国主义阴谋论是试图抹杀历史，漂白和遗忘当时学生和中国人民对经济改革所带来的权贵贪污腐败的现实有强烈不满的申诉。而至今中国还是面对八九年同样的社会问题。贪污官员还是一大箩，社会贫富矛盾还是非常尖锐。 刚温习唐代历史。唐太宗李世民在他最得力的助手，魏征宰相去世时说，“以铜为镜，可以端正衣帽；以历史为镜，可以知道国家兴衰的道理；以人为镜，可以发现自己的过错。” 历史是我们文明的一面镜子，试图遗忘、歪曲和篡改历史就是把这面镜子变成曲镜。曲镜会把胖的看起来变得瘦，颠倒是非，对于治理一个国家，就会存在着很大的潜在风险了。 回 头看看新加坡，我们何尝不是不敢面对我们自己的历史？尤其是那对行动党来说不是很光彩的历史！那充满白色恐怖的1970年时代，那世界上没通过法庭审判而 关得最久的政治犯，那许许多多以内安法令无理扣押政治对手的例子。这就是为什么我们的教科书里通常只会提到莱佛士登陆新加坡，二次世界大战至到独立，然后 就奉承现在的执政党歌颂功德，丰功伟绩的“历史”。也刻意抹杀了其他许许多多对新加坡社会建设有巨大贡献的人物，如陈六史等，就因为他们跟当时的执政党意 见不和，甚至抬杠，不认同他们的文化政策等！这是新加坡的悲哀。我们必须认真的去面对我们这一些历史事实，就算是对现在执政党有点不光彩，我们也必须去正 视，从中学习然后对这政治体系的不足做出调整，这才对我们的后代建设更好的文明社会打好基础。 我是一个相信人终究是会有缺点的，因而相信 在没有十全十美的圣人的人类政治社会里，我们就必须有自由民主制度来制衡人类丑恶的贪憎痴。纵然我认为邓小平在六四事件上做出了非常严重错误的政治判断和 决定，但他在我的政治认知中还是属于一个伟人。对新加坡政治人物也一样。纵然我觉得他们在那1960和70年代里做了许多不光彩的事情，我还是会尊敬这一 些先驱人物。原因很简单，人非圣贤，谁能无过？ 但是，我最不能忍受的是，政治人物或政党为了自己的面子问题而刻意去试图遗忘、歪曲和篡改历史，这是对我们的后代做出最坏的事。一个没有真正的去面对自己的历史是不会有文明的进步的。 吴明盛  Read More →

From The Newsroom Team The recent arrest of a few unarmed, peaceful protestors at a candlelight vigil in Perak had sparked widespread outrage in Malaysia. This would be unimaginable a few years ago before the advent and proliferation of socio-political news site like Malaysiakini, The Malaysian Insider and the Nut Graph, to name a few. The event, which was neither published in the print nor broadcast media, was given extensive coverage by the new media. A short clip by Malaysiakini uploaded on Youtube shows the protestors dressed in black holding candles in their hands be dragged away forcefully by the police. The footage dealt the image of the police and ruling Barisan Nasional another mortal blow. While the mainstream media in Malaysia are effectively mouthpieces of the government like Singapore's, young voters who are gleaned on the daily staple of news from the new media are the driving force behind the revolutionary changes sweeping through the political landscape. Singapore's activists, notably those aligned to the SDP, have made used of the New Media to publicize their cause too, but the impact generated is suboptimal for a variety of reasons: 1. The sites publishing their videos have a small readership and are unable to reach out to a greater audience. Malaysiakini has an online readership which is larger than the online versions of all the mainstream papers. Singapore news blogs run the risk of preaching only to the converted and unable to win new readers from the pool of mainstream audience. 2. Singaporeans are generally averse to politics, especially oposition politics. Though most young Singaporeans are net-savvy, they do not surf political blogs and show little interest in them. Singapore has few known socio-political blogs which are helmed mostly by amateurs unlike in Malaysia when prominent political commentators like Ong Kian Ming, Neil Khor and Tunku Abdul Aziz are regular contributors to news sites. 3. Singapore MPs have stayed largely out of the realm of civil activism to press for change in the system. The two elected opposition MPs are contented to air their views within the confines of Parliament. In the Perak candlelight vigil, one state assemblyperson, Jernice Lee and one MP, Teo Nie Ching, both in their 20s, are arrested by the police. These young leaders who are willing to take risks and walk the talk themselves are catalysts for awakening the political consciousness of the silent majority. In contrast, Singapore's civil activists face several daunting obstacles in their way, most remarkably by the lack of support from the general public who frowned on them as "troublemakers" out to destabilize society, a point harped on ad nauseum by the PAP and cleverly used by the mainstream media to influence public opinion. With a new law passed to prevent onlookers from filming the "security operations" of the police, local civil activists will be further crippled if they are unable to get their event publicized. Singapore New Media is still in the nascent stage and while it has shown promising signs of progress in the last one year moving from commentary-based to find facting-based sites like the Singapore Enquirer, it is too feeble to put up a stiff challenge to the monopoly of news coverage and dissemination currently enjoyed by SPH. Without full-time properly trained journalists and money to sustain these sites in the long, they will probably either fizzle out or stagnate in the end. In this year alone, a few sites such as Singapurakini and Singapore Cafe have shut down due to lack of time by the blog owners to maintain it. The new media revolution which has griped our neighbor across the causeway has yet to happen in Singapore. Until then, Singapore civil activists will always be fighting a losing battle on bended knees.   DAP politicians arrested at candlelight vigil (19 May 2009) Death of democracy protestors let off the hook  Read More →

By Edmund Khor, Guest Columnist On 15 May, the news media learnt from a quarterly report that Temasek Holdings filed with the US SEC (Securities and Exchange Commission) that the sovereign wealth fund had sold its entire 3.8% stake in Bank of America as of 31 Mar 2009. There was strong public concern as Temasek had realized a loss of potentially US$4.6 bn from its US$5.9 bn investment in Merrill Lynch.   Bank of America acquired Merrill Lynch in an all-stock deal worth US$50 bn announced on 15 Sep 2008 – the day that Lehman Brothers filed for bankruptcy. Merrill Lynch was at the time within days of collapse, and the acquisition effectively saved Merrill from bankruptcy. In Parliament on 28 May, Minister of Finance Tharman Shanmugaratnam in defence of Temasek asked that the sovereign wealth fund be evaluated based on its overall performance and revealed that it made a gain of S$56 bn over the period end-Mar 2003 to end-Nov 2008. This was equivalent to total shareholder returns of slightly over 15% per year on average in US$ terms. According to the minister, the loss of S$58 bn between Mar and Nov 08 came after a gain of S$114 bn over the preceding five years of the bull market cycle. The minister also claimed that Temasek outperformed many other large investors over the period. However as different investors have different asset and geographical mandates, comparing solely based on percentage return would be misleading. In this article, we attempt to analyze Temasek’s  investment performance against the risk profile of its investments.    Comparison against the performance of the local stock market The minister reported that Temasek had generated total shareholder returns of slightly over 15% per year on average in US$ terms. Over the same period, the S$ appreciated by 17% (from 1.76 to 1.51) against the US$, at an annualized rate of 2.9% per year. Thus Temasek’s total shareholder returns in local currency terms should be around 12%. The MSCI Singapore index (total return with gross dividend) in local dollar terms showed a simple annualised return of 11.3% per year over the same period. Thus it seems that there doesn’t seem to be much value-add from Temasek’s overseas investments in enhancing its overall return.   Comparison against the global equity market indices In this section, we compare Temasek investment returns against the global equity market indices. As the investment return was provided in US$ terms, we would compare it like-for-like against the US$ benchmarks. The minister has brandished the 15% average return against the 6% annualised return from the MSCI World index.  He also added that a weighted index of the global, Asian and Singapore equity market indices would have delivered more than 6% but significantly less than Temasek’s gains of 15% per year. However, a check on the MSCI index portal revealed that the MSCI World index is an index that is designed to measure the equity market performance of developed markets. It consists of 23 developed market country indices, including Australia, Canada, France, Germany, Japan, Singapore, Switzerland, UK, US etc.[1] A significant proportion of Temasek’s investments is in the emerging markets, e.g. China, Taiwan, Korea, India and Pakistan. The geographical distribution of Temasek’s portfolio as at end-Mar 2008, which is not too different from the year before, is as follows:[2] Regions Percentage Singapore 33% North Asia (China, Korea, Taiwan) 22% ASEAN 12% South Asia (India, Pakistan) 7% OECD Economies 23% Others 3%   Temasek have earlier maintained that its portfolio target is to have Singapore, Asia ex-Japan and OECD economies each account for a third of its exposures. On 12 May, Temasek’s outgoing CEO Ms Ho Ching when speaking to the elitist Junior Pyramid club revealed that Temasek had decided to revise its portfolio allocation to 40% to Asia, 30% to Singapore, 20% to OECD nations and 10% to Latin America, Russia and Africa. For a more representative benchmark to measure Temasek’s portfolio performance, we attempt to create a customised benchmark that best reflects the geographical distribution of Temasek’s investments. We have chosen the following indices with their weights as listed. 1.       MSCI Singapore Index                                                   35% (for Singapore exposures) 2.       MSCI AC (All Country) Asia ex Japan Index           40% (for North Asia, ASEAN and South Asian exposures) 3.       MSCI World                                                                        25% (for OECD exposures) The annualized returns of these indices in US$ terms over the period are as follows: 1)      MSCI Singapore Index                                                   16.2% 2)      MSCI AC (All Country) Asia ex Japan Index           15.7% 3)      MSCI World                                                                        6.4% – this was the number the minister used The annualised return of the customized benchmark would be 13.5% per year, which is significantly higher than the 6% from the MSCI World index used. If we were to weight the indices equally, the annualised return of the customized benchmark would be 12.7%. Going by the numbers, Temasek has outperformed the more representative benchmark by only 1.5% per year.   Not your ordinary fund manager However, Temasek is not your typical fund manager. The state investment vehicle has also been tasked with the privatization of government-related companies, like Singtel and SMRT.  Government-linked companies (GLCs) indentified for privatization or divestment were typically transferred to Temasek. In 1997, the government transferred PSA (formerly the Port of Singapore Authority) to Temasek.  In 2001, Temasek received in its arms Singapore Power together with two electricity generators - PowerSeraya and Power Senoko. The other unlisted entities in the portfolio include MediaCorp, ST Telemedia and Mapletree etc. As of 31 Mar 2009, 21% of the assets in the portfolio were unlisted. Temasek uses the book value or shareholder equity of these unlisted entities for the valuation. Market gains are realized only when investments are sold. Over a period of 10 months in 2008, Temasek sold all three Singapore power generation companies under its charge. These gencos together generate 90% of Singapore’s electricity needs. Date Entity Sold Buyer Proceeds Mar 2008 Tuas Power China Huaneng Group S$4.235 bn Sep 2008 Senoko Power Japanese consortium S$3.65 bn Dec 2008 PowerSeraya Malaysia’s YTL Power S$3.8 bn What is not known are the transaction prices of these asset transfers between the government and Temasek. If the prices were significantly on the low side of things, the gains from the sale of these transferred entities would artificially inflate Temasek’s overall investment return. Global Investment Outlook To combat against the domino effect of the subprime mortgage crisis particularly after the collapse of Lehman’s Brothers, various governments have committed or spent sums of money unheard of in loans, asset purchases, guarantees, and direct spending. The government policy response has been to load up all the risks & debt onto public sector. Countries like UK, Ireland and Spain, are now facing increasingly limited fiscal flexibility resulting in actual or potential rating downgrades.  The quantitative easing actions and bank bailout packages by countries like US and UK are expected to create huge tail risks in the form of significant foreign forex and rates volatility. The lead risk drivers in the financial markets in the coming months are likely to be the forex and rates markets, rather than the credit and equity markets.   Better Risk Management and Disclosure Needed Our analysis against the global equity market indices raised a question whether the Ministry of Finance has used a representative benchmark for the emerging market risks that Temasek’s portfolio is exposed to. Using the MSCI World index meant for developed markets is clearly inappropriate, particularly as Temasek is allocating more money into Asia ex-Japan and new emerging markets, like Latin America, Russia and Africa. Apart from not using a more representative equity market benchmark, it also seems strange that the Ministry of Finance is presenting (and hopefully not assessing) Temasek’s portfolio return in US$ terms while the shareholder equity base is in S$. This is crucial given that 70% of Temasek’s investment are in overseas market, the expected forex volatility in the coming months could impact Temasek’s investment performance significantly. Another issue is the management of investment risks. On page 58 of Temasek Review 2008[3] revealed that the fund’s Value-at-Risk increased by 67% versus a year ago to S$40 bn as at Mar 2008, thought its portfolio value increased by only 13% to S$185 bn due to increased market volatility. Temasek lost half of its 5-year gains in 8 months. On hindsight, the Government would have done much better if it had asked Temasek to cap its investment risk in face of the uncertain and increasingly volatile macroeconomic environment, and shift the money to the Monetary Authority of Singapore (MAS) which invests mainly in G3-denominated government bonds. Finally, more disclosure is required. Our government reserves ultimately come from Singaporeans’ CPF savings, and past budget surpluses from income taxes, GST and other government charges Singaporeans paid. People have the right for more transparency from our sovereign wealth funds. Without revealing on tactical investment strategies, Temasek and the Government of Singapore Investment Corporation (GIC) should publish portfolio level return figures to show how their various asset classes performed against their benchmarks. A good example of such disclosure is provided by The Government Pension Fund of Norway.[4] ==     Exchange Rate and equity indices used Bloomberg Ticker Value as at 31 Mar 2003 Value as at 28 Nov 2008 Simple annualised return USD/SGD exchange rate SGD Curncy 1.7641 1.5131 2.9% MSCI Singapore Index (local SGD) GDDLSG Index 1450.216 2377.218 11.3% MSCI Singapore Index (USD) GDDUSG Index 2526.22 4841.69 16.2% MSCI AC (All Country) Asia ex Japan Index (USD) GDUECAXJ Index 236.372 446.276 15.7% MSCI World Index (USD) GDDUWI Index 2074.666 2827.608 6.4%   [1] See http://www.mscibarra.com/products/indices/equity/definitions.jsp#WORLD   [2] See http://www.temasekholdings.com.sg/our_portfolio_portfolio_highlights_geography.htm [3] http://www.temasekholdings.com.sg/TemasekReview/2008/pdf/TR2008%2018-08-08%20Bookmarked.pdf [4] http://www.ftf.no/key_figures.html  Read More →