TR EMERITUS

Romanians and Bulgarians protest outside Downing Street last year for rights equal to those of other EU citizens (17 Jun) - Nearly two-thirds of British people believe immigrants from within the European Union (EU) should wait at least three years before they are allowed to claim welfare benefits, a major survey of social attitudes has shown. A hardline view of immigrants is revealed in the 31st NatCen Social Research British Social Attitudes survey, in which nearly a quarter of British people said the main reason immigrants came to the UK was to claim benefits. There was also a considerable drop in the number of people who believed legal immigrants who were not British citizens should have the same legal rights as British citizens – from 40% in 2003 to 27%. The survey of more than 3,000 Britons was published after Ukip's unprecedented success in the recent local and European elections presented major challenges for all three major political parties. Elsewhere, 95% told the survey that to be "truly British" you had to be able to speak English, while 74% said it was important to have been born in Britain to be considered British. Penny Young, the chief executive of NatCen Social Research, said: "In an increasingly diverse, multicultural country, we might expect people to be more relaxed about what it means to be British, yet the trend is going in the opposite direction. "It is now harder to be considered British than in the past and one message comes through loud and clear: if you want to be British, you must speak English. "And as we debate whether Ukip's vote will hold up in the general election, British Social Attitudes shows that the public is yet to be convinced that politicians have got a grip on immigration. "They want tougher rules on benefits and many are unaware of the policies that are in place to control immigration."   More in: http://www.theguardian.com/uk-news/2014/jun/17/immigration-british-attitudes-harden-benefits  Read More →

76-year-old Irene Yap begging MP Hri Kumar to help her get all her CPF money back Ms Irene Yap, 76, received VIP treatments from CPF Board after she poured out her grievances in a recent CPF dialogue organized by MP Hri Kumar at Thompson Community Centre last Saturday (14 Jun). Officers from CPF Board personally paid her a visit to get in touch with her yesterday (20 Jun). She is a resident of Bishan-Toa Payoh GRC. At the dialogue, she begged MP Hri Kumar to get her money back from CPF Board ('Old lady begs Hri Kumar to get her CPF money back'). She said, "What I want is my money back and I want to arrange for my funeral and I want to arrange for my rice and I want to arrange for a nice settlement. Can I have it?" "That’s all I want. Give me back my money. CPF, give me back my money. And make it as soon as possible. Because 76, I won’t be able to live." She begged the MP, "So, Mr Hri Kumar, please. Help me get my money back and I am going off now. Thank you very much." Her plea was captured on video and it went viral online. Yesterday (20 Jun), Senior Minister of State for Manpower and Health Amy Khor issued a statement to clear the air. Dr Khor said, "In all probability, Ms Yap mistakenly believed that she has no avenue to withdraw her Retirement Account (RA) Savings. It is unfortunate that this has led to some public misunderstanding." "Thus, it is important for the Central Provident Fund Board to clarify any erroneous perceptions and address public concerns." Both Dr Khor and the CPF Board explained that the CPF Board had already notified Ms Yap four months before her drawdown age in 1998 that she could apply to receive monthly payouts from her RA. In 2012, in response to some queries Ms Yap had, the CPF Board reminded her she could start her monthly payouts any time, or withdraw her RA savings in a lump sum, provided she had property to pledge. But CPF Board did not receive any instructions from Ms Yap, Dr Khor pointed out. The Board sent officers to personally visit Ms Yap yesterday morning. The Board said it is in contact with her to help her withdraw her RA savings if she wants to. Dr Khor added, "I would like to assure members of the public that the CPF Board acts in accordance with prevailing CPF policies in the interests of its members. CPF Board does not withhold any member's CPF monies if they are eligible to withdraw them, as with Ms Yap's case." The Board said in its statement that CPF members who meet the minimum sum when they turn 55, including those who have pledged their property, can withdraw any amount over the minimum sum, from their Ordinary and Special Accounts. On CPF website [Link], it said: 1. Using your CPF balances in your OA and SA When you reach age 55, a portion of your OA and SA savings will be transferred to your RA to meet the MS. If there is still a MS shortfall in your RA, a portion of the new inflows like contributions, voluntary contributions, government top-ups and other refunds received after 55 will be used to make up the shortfall upon your subsequent CPF withdrawals. 2. Pledging your property You may pledge your property up to 50% of the MS after you have obtained the consent from all other co-owners to do so. The amount that you can pledge depends on: HDB’s quarterly median resale prices for HDB flats or valuation price for private properties; Outstanding housing loan amount (including non-housing loan for private properties); Co-owner’s CPF usage (for joint-ownership cases); and Your share of the property. Upon the sale of the property, you will need to refund the principal CPF amount withdrawn towards the property plus the accrued interest as well as the pledged amount. However, according to the transcript of the video [Link], Ms Yap seemed to be asking something else. She was then asking MP Hri Kumar: "I retired in 1998, I did a two year in associate, I did as an associate teacher until 2000. And when I retired in 2000, I told myself, since I have my food, I don’t need it. Money put in the government is the safest. And I think it was wrong. It was wrong. When I get to CPF to get my money, when I get to CPF to ask for my money, they told me that I can take my ordinary account but when it comes to RA, after ten years, after ten years you can take one month of repayment. I am free from all these rules and regulations. This only concerns those under 1958 and downwards. Those born before 1958 should get all the money back. Do I get mine? Can I get mine?" Ms Yap appeared to be asking if she could take out ALL her CPF money, including those in RA even if she didn't pledge her property. She is saying those born before 1958 are not subjected to the minimum sum rule. That seems like what she is asking. What do you think?  Read More →

Financial knowledge and investment performance - No monkey business Gd performance in managing money is a matter of luck. So whether Ho Ching is qualified to run Temasek or not is irrelevant: is she lucky? And paying peanuts or millions of $ is irrelevant, at least in managing wealth. [C]omputer programs run by Cass Business School that have randomly picked stocks using data from the past 43 years. Their performance was then compared to stock market index trackers, and in every decade bar the 1990s the “monkeys” won out. Cass professor Andrew Clare – co-chief executive of “Simian Asset Management” alongside the monkeys – says: “We programmed a computer to randomly pick and weight each of the 1,000 stocks in the sample; we effectively simulated the stock-picking abilities of a monkey. We found that nearly every one of the 10m monkey fund managers beat the performance of the market-cap-weighted indices. One of the implications of our work is that we should perhaps be benchmarking our fund managers against monkeys rather than against a cap-weighted index.” (From Observer) This too … “A BLINDFOLDED monkey throwing darts at a newspaper’s financial pages,” wrote Burton Malkiel in “A Random Walk Down Wall Street”, his 1973 bestseller, “could select a portfolio that would do just as well as one carefully selected by experts”. Many investors took issue with Mr Malkiel, an economics professor at Princeton University. Some researchers have also contested his prediction, but not because they think that he exaggerated the power of randomly picking stocks; rather that he was too modest. Simulating a dart-throwing monkey has resulted in portfolios that would not just beat many investors, but also outperform the market. In a study Robert Arnott and his co-authors picked 100 portfolios, each with 30 equally-weighted stocks from the 1,000 largest American stocks by market capitalisation. 94 of the 100 “dartboard portfolios” did better than a market cap-weighted portfolio of all the 1,000 stocks. Similarly, in another study Andrew Clare, Nick Motson and Steve Thomas randomly picked American stocks to construct ten million indices. An additional twist to their experiment was that the stocks were also randomly weighted. Nearly all of the ten million “monkey indices” delivered “vastly superior returns” compared to a cap-weighted index. But “financial knowledge does appear to help people invest more profitably” and that this may be a reason to “enhance financial knowledge in the population at large”. This study, while compelling, does not necessarily contradict the superior performance of dartboard-equipped monkeys. The most knowledgeable respondents in the survey were found to hold 11.5% more stock in their portfolios than their least knowledgeable peers. It could thus simply be the case that more financially literate individuals hold more stocks rather than being better at picking them. While the authors speculate that the estimated positive effect of financial knowledge on returns could be even stronger if investors face a more complex set of choices (the particular institution in this study offered a menu of mostly index funds), the opposite is also plausible if financially illiterate individuals were to be found to make more random stock selections. http://www.economist.com/blogs/freeexchange/2014/06/financial-knowledge-and-investment-performance Cynical Investor Source: Thoughts of a Cynical Investor  Read More →