20161107 How much CPF retirement savings does GIC really need?

I refer to “CPF interest rates ‘offer best risk/return tradeoff”. This is yet another attempt to convince the public that there’s no alternative investment vehicle other than signing a blank CPF cheque to GIC.

The article quotes mostly from a Ng Ko Song**, former GIC CIO. CPF members should be aware that GIC relies on a steady stream of CPF funds – more than $20 billion annually – for investment. Ng is basically telling the public that he and his colleagues are masters of the universe.

If Ng were half as competent as portrayed by MSM, there would be a long queue of potential investors stretching from Capital Tower to Timbuktu. But who would want to invest in a fund manager who has never disclosed his investment track record?

Last year, Ng and 2 former GIC colleagues started Avanda Investment Management Pte Ltd with most of its seed capital coming from … GIC. It appears GIC employees are unable to make it in the real private sector and need to perpetually leech off CPF menbers and taxpayers. I guess these people are not termed ‘jiak liow bee’ for nothing.

If these ‘great’ GIC fund managers were for real, they wouldn’t fear disclosing their portfolio and allow the public to judge for ourselves. Warren Buffet and other stellar fund managers aren’t afraid of transparency, so what’s there for GIC to fear disclosing?

Avanda trades “bonds, equities and currencies” and uses leverage in investment. What this amounts to is speculation which carries significant risks. But Singaporeans were hoodwinked by sex-crazed Josephine Teo who insisted that GIC and Temasek won’t take more risks?

In July, Temasek Holdings handed $3,000,000,000 of our reserves to Ng and company at Avanda. Avanda operates like a hedge fund and hedge fund closures had returned to crisis highs in 2015. Is Tony Tan awake, jaga-ing after our reserves?

Without transparency at GIC for 35 years, the logical conclusion is there are massive losses which have been concealed. Due to these massive investment losses, GIC is unable to generate sufficient returns and now requires gargantuan amounts of CPF to do so.

The article also refers to the present low interest rate environment and states the obvious – “guaranteed rates (slightly higher) are so much better”. But what about those years when interest rates were much higher and CPF members were severely shortchanged?

There are obvious risks in putting more CPF savings with a fund manager which does not believe in transparency and accountability. Caution is warranted because the PAP-controlled Parliament could rubber stamp a lower CPF interest rate in the near future.

And readers have been duly warned by the propaganda writers: “The 4 per cent floor rate for monies in Special, Medisave and Retirement Account has been extended until end-December 2017”.

CPF members should protect their own interests and demand transparency from PAP. So why does GIC need so much funds when all major asset classes are inflated? If it is not concealing losses, why is it unable to be upfront and transparent?

** Correction – ‘Ng Ko Song’ should be ‘Ng Kok Song’.

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