Monday, December 15, 2008

It Wasn't Me

If there is anything that the Singapore government has failed to do in a miserable fashion, it has been to develop a sense of responsability amongst Singaporeans. The government has been undoubtedly authoritarian in its outlook, but its been a most benign authoritarianism. Unlike other authoritarian regimes, Singaporeans live comfortably and for the most part without fear.

However, years of benign authoritarianism has created what Shaggy appropriately calls, "It wasn't ME," culture. As far as Singaporeans are concerned, it's vital that you pass off responsability for all actions to someone else. Americans are proud of the legend of how their first President, George Washington declared, "Father, I cannot tell a lie, it was me," at the moment the old man screamed at the kids for cutting down his favourite tree. In Singapore, George would have died a slow and agonising death....his buddies would have realised that this was the sucker to pin everything on. George would have been punished for telling the truth, while the rest of them would have lied and got out of trouble. 

You will hear Singaporeans bitch and moan about how the government is restrictive and how they are made powerless by the system. But the truth is, being powerles is a wonderful experience. Personal power over your personal life is a vastly overrated experience - it means you actually have to answer for your own actions instead of pinning it on the government. 

Of course, the government has to take responsability for some of this. It's been so super efficient, that people have, as my young politician has reminded me on so many occasions, "Have FAITH," in the government. - Note, this is a democratically elected and secular government we're speaking of, not a theocratic one annointed from above. 

Singaporeans, for all their sophistication have become so used to not taking any personal responsability and having "Faith" in all sorts of authorities have made Singapore a haven for conmen. We may be educated and have the best legal infrastructure in the region but as long as you can carry yourself and speak with confidence, even the most sophisticated of Singaporeans will give you anything you want. Americans and Austrlians have been particularly good at exposing this side of Singaporeans. 

How does this, "It wasn't ME," culture come into play? The year 2008 will be a year where we got to see both ends of it. Early in the year we had the escape of Mas Selamat, the limping terrorist who hobbled out of a secured facility and remains at large even as we speak. In most nations, there would be calls for a ministerial head. Most rational people would ask, "How the hell did an unarmed limping man stroll out of a secure facility, which apparently has the latest technology?" When the Committee released its findings, nobody asked,"How the hell could a facility meant to hold the worst-of-the-worst, lack a simple window grill?" Instead, the people who should have been responsible for the fiasco turned around and blammed the rest of us for expecting them to do their job.

Now, as the year draws to an end, we're being treated to a spectacle of how the population at large, has afflicted by the "It wasn't ME," culture. The incident is of course the DBS High Notes Five - a case of a group of people losing money in an investment product sold by the Development Bank of Singapore (DBS), and secured by the now defunct Lehman Brothers. 

The investors are up in arms, claiming that they've been "Missold" by the banks and former NTUC Income Chief Executive Officer, Mr Tan Kin Lian has become the champion of the "people," as he claims to try and force the banks into refunding the money of the investors. If the old hero of Singapore is Mr Lee Kuan Yew, today's hero, it seems is Mr Tan.

I hate to be a party pooper here, but what exactly is Mr Tan a hero of? If anything, Mr Tan is championing a greater encouragement of - "It wasn't ME." Look at what he is telling the world - "You got screwed by the bastards in the bank," "You had no choice excpet to hand over your cash," "Follow me." 

OK, I am no fan of the banks in Singapore. As far as I'm concerned, I only use a bank because I need to recieve cheques and one does not always want to carry too much cash around. Other than that, the banking services here does not offer me much. I also can accept that the banks use high pressure techniques to get products sold. Then again, are the banks doing anything that most businesses don't do? 

Mr Tan is a charismatic figure and he's hitting against a group that's easy to dislike. Having said all that, is Mr Tan and his motley crew actually doing anything of use. So far, the banks are being accused of:

a - Selling people products they didn't understand. 

If the banks and the relationship managers are guilty of selling products to people that they didn't understand, why did the people buy them? Surely, if you are somewhat rational, you would not put $50,000 into something you had no idea about? 

Sad truth is that people are easily seduced by charts heading north and the banks will provide plenty of charts to show you just that. However, all financial products are legally obliged to come with a disclaimer to remind you that - "What goes up can go down," and "Just because things have gone up, it doesn't mean they always will." So, if the RM does not remind you of this, there's always the prospectus, which one would assume you have looked at, at least once. Appealing to your greed is not crime, it's not even unethical. 

One of the conversations I had online on this topic went as far as to remind me that we don't understand the medicine our doctor gives us, but we take it anyway. Erm, I wonder if this person simply takes his medicine blind? Surely, if the doctor gave him an explination he didn't understand, he'd have the cow sense to get a doctor who could. Likewise wouldn't you do the same if your financial advisor started speaking gobbldygook to you? 

b - DBS is a trusted bank

DBS has its reputation but I can only go back to the point about reading the fine print. As any busines would do, DBS will sell the products that it believes will make it the most money and while a bank of DBS's stature will do what it can to ensure the products it provides a legitimate, the same basic rules of investing your money should apply:

i - Read the fine print - what goes up can come down
ii - Want greater rewards? Prepare for Greater risk. 
iii- Past performance is no guanrentee of the future. 

High Notes Five was a high reward but high risk product. The minimum requirement was at least S$50,000 - not the sum that most poor simpletons would have at their disposal. So, given the liklihood that most of the buyers of these notes had the capability to assess risk independently and get other information independent of their RM's - why the hell are they screaming that they've been conned. 

Mr Tan is creating the stuff that news-scarce Singapore is dying to read about. It's a good story. "Ex-Big Shot helps the People against the Big Bad Banks."

But read beyond the headlines that Mr Tan wants you to read and it will become clear that this is a story of educated and capable people indulging in their "It wasn't ME," tendencies being egged on by a man who has seen better days. 


1 comment:

Xtrocious said...

Sorry but your rant made as much sense as the Town Councils in explaining their "losses"...

People who wanted to renew their fixed deposits were definitely missold when they were told that these toxic products were as safe as fixed deposits.

True, people should not be buying what they don't understand but isn't it a greater sin to sell something to someone who they know won't understand what they were buying into?

Anyway, you also cannot expect people to be knowledgeable about everything - can you even claim to understand the prospectus of the minibonds after reading it?

I know I certainly can't and I work in the financial industry and my job is looking into these numbers.

Last but not least, if we do not trust the "experts", then who can we trust?

Isn't it like going into the doctor's office and instead of listening to the doctor's advice, we only insist on having panadol cos that's the only medicine we know and understand - even if the illness is life-threatening?