Keechiu Chan: “Keeping half of Singapore’s earnings from its reserves is important as it signals to currency markets the strength of the Singapore dollar.”
It has been estimated that Singapore has an estimated more than $1 trillion in reserves. A fraction of this amount would have been sufficient to discourage currency speculators from launching any attack.
Keechiu appears to be taking Singaporeans for fools and is effectively saying this:
It is only an inherently weak currency that needs billions in reserves to discourage attacks by speculators.
A small and prosperous country which needs “more than $1 trillion” in reserves to back up its currency is likely to be country in concealed deep shit. ;(
Why does Chan continue to believe that currency speculators will somehow anyhow attack a ‘strong’ Singapore dollar? Keechiu should not portray currency speculators as all stupid and jiak liow bee.
If an estimated $1 trillion in reserves still cannot prevent speculative attacks on the Singapore dollar, no amount will.
Keechiu’s argument is really all hogwash.
A possible reason for Keechiu and the PAP to continue insisting on increasing our “estimated more than $1 trillion” reserves for the above-stated reason: there are huge concealed investment losses.
PAP should come clean asap because concealed investment losses – over decades – will have severe implications. 😦