Today chiong ah!!!
I have never seen CLCT go up 10% in a day. Wonder who the hell wants to buy at this price?
Covering shorts? LOL
Anyway, enjoy the ride. I am still underwater on this one, but always happen to see it approach the water surface, hopefully it can get some air soon...hahaha
Finally I decided to expand my SG bank holdings to include UOB, bought 100 shares at $32.65
I don't think I'l make much, but this will form the start of my accumulation journey for this bank, similar to what I did for OCBC.
What about DBS? I think DBS is amazing, but it also has a big run up in share prices recently, so I'll wait. Moreover, I feel buying any of the 3 local banks are about the same, just that I feel better to diversify into at least 2 instead of just focusing on 1.
I also have all my SRS funds invested into STI ES3 index ETF, which is like 40-45% composed of the 3 banks, so in a way I am already invested in DBS lol
I think everyone will think rate cuts over this year and next will hit the banks hard, but I don't think so. The banks are not dumb, they also expected the rate cuts so they are prepared for it. When rates are cut, they will just reduce the rates paid out to depositors to maintain their interest margins. It's not that simple but the general idea is there.
Uncle had resigned from my job, due to various reasons that I shall not dig into here as that is not the purpose of this post.
Whether this will be a transition phase before I get another job, or an actual retirement from work, I don't know yet. It is, TBH, pretty scary since this is definitely a new experience for me. While I am fortunate to have a spouse who is still working and earning a decent income, plus I am in a non-too-shabby financial situation, it is still scary. Why?
I think the scary part is, I have not much reference point to take inspiration/learnings from. Have been checking out blogs and YouTube for ideas, but all these are usually influencers who wrote for some underlying motivation that doesn't really reflect real life. I am sure someone who is very real has wrote something out there, I just need to keep searching. Also, have been making a point to talk to friends to get some ideas, but that can only help a little, given how diverse our personal experiences and circumstances are, not to mention different financial situation. But it was still useful, at least from a mental perspective, of catching up with old friends which I would had otherwise not able to do so if still fully employed with my very busy and demanding job.
So, what did I do? Well, like most people who take a break/sabbatical from work, I worked out a list of to-do list, mainly from perspective of personal financial management and professional skill improvement. These are due to 2 prong reason:
1. Getting my finances in order now that I have time on my hand is important. I need to ensure I can retire, regardless of if this is the retirement already or later.
2. I need to upgrade my skills, stay challenged.
So did I get started with my todo? Well, yes and no. I was busy pouring money into SG market in last 2-3 months, in order to generate passive income flow. I spent time to read reports, watch financial videos etc to make me make better decisions. Read a lot of news as well to be aligned with what's going on in the markets. For skills, I am kind of jumping all over the place, and facing difficulty in settling down and focusing. Maybe I was too excited with stock market lol. As mentioned in earlier posts, I also feel very tired from mid day onwards, which is why I am also focussing on physical activity to gain strength and health and stamina.
But suddenly, I think I get it now. Since this is the first time ever that I actually stopped working (very different from taking a 10 day vacation every 6 months), I should give myself some slack, for real.
That means, don't lecture myself too hard for not checking off the todo list as if my life depends on it. It does, but it's not in such a big rush that I cannot afford to take a real break. Yes, I should take a real break. Family commitments aside, housework, time with kids and wife, I should take it really easy. Focus on health, rest, and good company, and actually have times where I really do NOTHING, not even scrolling social media on phone or sleep. Just blank out, and maybe listen to my favourite songs (not watching videos)
Once I get to taste this fully, I should be more settled down, Basically, give myself the chance to 100% immerse in this new experience, take a real break!! Make is a real rest and reset. Change my life around. Be a better person than I could ever be. Then slowly start to check off my list of todo, especially learning new skills/updating existing skills. The world is there for me to conquer!
During kopi, I was reading this https://www.channelnewsasia.com/singapore/99-1-property-arrangement-tax-mother-and-son-charged-4620016
I wonder who is the mastermind. The mum, the son, or the agent(s).
This is a showcase of a very painful lesson that awaits those who think they can outsmart the tax man by exploiting so-called loopholes. TBH, if it is a loophole and you think it is there for you to exploit, do think twice or even twice-twice-twice. This isn't a game of DOTA. The downside of being caught is way too high vs the gains you can get.
Imagine being forced to cough up the owed ABSD plus up to 50% of it as a penalty. If you can't afford to pay the ABSD in the first place, I cannot imagine what shit hole you are digging yourself now that you have to add 1.5x of the same amount. Probably have to sell home or take a loan from others.
Uncle bought a condo as 2nd property with Aunty back when we still had our matrimonial HDB. At that time, ABSD for SC for 2nd property was 7%. (It was initially 3%, but was raised to 7%). Our condo costs about 1.1M, so we coughed up about 80k cash for ABSD. Huge amount for us, but we rather pay up and sleep well and not worry about breaking any regulations. We then rented out our full paid HDB for 3-5 years, which basically recovered the ABSD amount, before we decided to let the HDB go as it was getting rather old with many maintenances needed.
Granted, the same ABSD is now 20% (OMFG), which effectively means a large chunk of commoners (like uncle) who started with HDB, has no way to upgrade easily, but have to do it the more troublesome ways, which I think ( I could be wrong, please don't rely on this for your property planning) are:
1. sell HDB first before buying condo. If condo is still pending construction, then have to rent a place while waiting for condo to TOP. If condo is resale, still have to rent a place while doing renovation. Move multiple times. Rental costs, moving costs, stressed like siao
2. buy condo while holding to HDB, fork up the 20% ABSD, but sell HDB within 6 months of taking keys of condo, which will allow the 20% ABSD to be refunded to you. For this, you need to have that cash to pay the ABSD first. Not everyone can do that, since you also need cash to downpay/renovate the new condo. This can easily reach 500k or more, assuming condo is at least 1M. Plus if you sibei suay, HDB prices could be depressed during the 6 month period you have to let it go at fire sale due to time constraint.
3. Like 2, but you simply pay the ABSD, and keep both condo and HDB, likely renting out the HDB, but it will take a pretty long time to recover the large ABSD amount via HDB rental, even if HDB is fully paid up.
Method 1 seems to cost less than 2/3 in terms of outlay you need, but at the expense of stress to family during this "musical chair" dance. This is especially hard if you have kids in school. They have to adapt to new place, deal with exams, deal with the multiple times of relocating. Such stress can be massive and can cause permanent damage to family relations. Don't take it lightly. Method 2 is likely the safer option, but only for cash rich people, since if you have to borrow to pay the ABSD, that itself will be stressful. Plus you could potentially get less profits from your HDB due to rushed sale.
Method 3 is simplest but very costly since you literally pay 20% extra on your condo. How to break even huh? 1M condo, becomes 1.2M. Immediately you are at 200k disadvantage compared to your new neighbour when it comes to selling.
Regardless, these methods are legit ways and let you sleep well at night lol. Don't do 99-1 or whatever shit that smart-ass people comes up with on internet media. They have no skin in the game, its your skin leh.
Invest, earn income from it, add the income back to capital, now earn more income, add that income again back to capital. Rinse and repeat. Your capital grows at accelerating rate, along with the income it generates, even if returns is a fixed % of capital.
Make every dollar work hard for you tirelessly while you enjoy life. They are your little minions...
The hardworking minions generates some more dollar/minions, which are immediately added to the "workforce" to start working for you, so you have more and more minions working for you over time.
This is how rich people get richer and richer, not without effort, but with less and less effort as the workforce grows. You'll never run out.
Felt really sleepy about 30mins after lunch. Had a bowl of dry prawn noodles from nearby hawker stall. As with such hawker fare, it is mostly carbo with little protein and veg. Tried reading on my computer in my cubicle room with a/c on, but 30mins into it, zzz monster struck!
Went to take a nap for 1 hour and typing this now.
I don't think I have health issues. So I am attributing (i.e. blaming) it on:
1. Carbo heavy lunch
2. hot weather/AC stuffy
Did my usual bicep curls and took a banana and went for a walk and go to lounge to read.
I need to switch/watch my lunch food
Next week, FED is likely to cut rates, but there are also other possibilities
- cut rate
- doesn't cut rate
- cut rate by larger than expected
- cut rate by smaller than expected
Specifically for SG counters, REITs are going through some wild swings, but mostly up.
Looks like everyone is buying REITs, based on common logic that lower rates will result in REITs earning more as they refinance their loans at lower rates, thus resulting in high DPU. And of course this will not happen overnight, as it depends on the rates that each REIT can get, as well as their loan expiring/renewal schedule. This also assumes rental revisions are same or higher for the REITs. Assuming no recession, we can expect rents to inch up over time. So, does it mean the current REIT unit prices are already at the level we expect for the expected rate cut, i.e. it's already priced by market?
So if FED did not cut, or cut smaller than expected, we can expect REIT to correct down, and Banks to inch up as market emotions swing again. I always wonder how much of such swings are real or just heard mentality.
While I always think REITs will go up as rates get slowly cut, I am hesitant to put all my eggs into REITs to ride this potential wave. First, they probably won't go up to pre-covid levels, since rates won't go to near zero. 2nd, we could go into recession, less employment, hence less rental income for REITs, which could more than offset the rate reduction impact on loans, resulting in lower DPU at last and REITs price will drop a lot.
I can't predict future just like everyone else can't, so I cannot take extreme ends of this equation. Need moderation but also some risk taking. No risk no gain. (but high risk , high loss)
So REITs will continue to be a large portion of my SG portfolio, but I will slowly nibble at each counter when prices are steady or down 2% or more, slowly DAC up, while keeping my average price below market as much as I can, to give a safety buffer. Meanwhile, continue to hold some cash for opportunities should things turn south. I think buying the big brand REITs should be ok. And time to put some $ into UOB or DBS, instead of all on OCBC. This should cover me on banks to balance off the REITs exposure
better battery life, slightly bigger screen, faster processor. Isn't that expected when you produce a new iPhone model?
I think I'll stick to my current one until IP17 or IP18 is out, and not because those will be much better than 16, but because by then my current IP will require a battery replacement and also probably a little too old. But as usual, IP has resale value, so I will be able to sell mine for a decent few hundreds to offset the new one. No need to change every 1-2 generations, unless Apple comes up with something revolutionary.
The folding phones from HONOR and Samsung are much more interesting. They really present something different. But for now, Uncle cannot see why he needs to use a large screen when out and about.
FED started raising interest rates from March 2022 to curb inflation. Rates were near zero, and the hikes bring it to above 5% over a period of 1.5 years.
During this period, banks enjoyed increased profits since they can loan out money for more interest earnings vs what they pay to depositors. This helped the 3 local banks that have large savings deposits.
At same time, REITs suffered as they had to set aside more money to cover higher intest payments for their loans as they refinance during this period, moving money to the banks coffers instead of paying out as dividends to unit holders.
So Uncle think its always good to balance a portfolio with REITs and Banks. When rates are high, dividends from REITs drop because the money goes to Banks. But dividends from banks goes up, so this goes back to you as investor.
I expect banks to lose some earnings as rates get cut gradually over next 1.5-2 years, while REITs will start to recover as they refinance loans with lower rates.
But I don't think rates will go back to pre-2022 days of near zero. So REITs won't go back to previous highs, while banks won't go back to earlier lower prices. But they will balance out.
End of day, as long as the dividends continue to come out from the portfolio at 5% rate, uncle very happy liao.
Slowly accumulate, don't get swayed by emotions, or fancy get-rich things, avoid following trendy thing (bitcoin, options etc), buy low, sell high (or hold), Uncle can do it, so can you.
Going forward, I will continue to add more to increase the income flow. But will retain double-digit percentile of cash and US equities for balance
It's funny when some clueless drivers of ICE cars, typically those older than 50yr old, have no idea how fast most EVs can take off from stop. You'll see such drivers thinking their 2.0/2.4L IL4 petrol cars (usually Japanese MPVs/SUVs) can easily overtake/cut-off all other "small" sedan cars on the roads (except those which are obviously sportscars/super cars), and hence they tend to not want line up early on the correct lane to make a turn, thinking their big and powerful family mobiles can just zoom out first and overtake any car from stop lights.
Then you'll see their disgruntled face in your rearview as your EV left them many car lengths behind within 2-3 secs, as they end up having to filter behind to change lane in order not to miss their turn.
Yeah, you clown, now it's time to have a taste of your own medicine. Plan your route properly, the roads are no longer a playground for you to any how drive, as your stupid petrol car isn't the fastest dog now. Listen : ANY EV can outrun your stupid car from stop at least for first 2-3 secs before you can catch up, so on normal roads with many traffic lights, you have no chance to cut off EVs unless they let you pass. Eat the humble pie. Oh, I also think you won't upgrade to EVs, because its probably out of your budget to get a 6-7 seater EV to replace your petrol one, or more likely, you are too dumb to know what is EV and too fearful of new things.
On a more serious note, once most cars on the roads are EV, I believe the driving situation in SG will become much more tolerable. Why? Because of the democratisation of car power. If everyone drives EV, everyone knows their car isn't always going to accelerate faster than others, it's as if everyone is driving the exact same car. Yes some sub 4 seconds EVs will still be ultra fast, but day to day driving, the difference won't be that big especially on norma non-highway roads with traffic lights.
This change in dynamics will alter most drivers' behaviour...to that of MUTUAL respect. It's like arms race between nations, if all nations have similar powerful armies, there will be mutual respect and ironically more periods of peace. Its like the internet, where anyone with internet has the same universal access to same information, so no one can simply claim to be more knowledgeable, made even so with GenAI chatbots at your disposal anywhere.
So drivers in future will plan their driving more intentionally, with the understanding that poor planning means no being able to make a left/right turn at next stop light due to heavy traffic (that can move as fast as what you drive lol).
