Named after Charles Ponzi, a Ponzi scheme is a fraudulent investment operation that pays unrealistic returns to its investors from their own money or the money paid by subsequent investors. The latter explains why Bernard Maddox could get away with it for so long (federal investigators believe the fraud began as early as the 1970s). When the high returns to the earlier investors could no longer be sustained, it was the money from the subsequent investors that perpetuated the scam until the mathematics no longer hold.
In our context, the lure of asset enhancement has given licence for the authorities to inflate public housing prices, via the mechanism of linking to private property rates and some mysterious accounting entity called "land reserves". Whatever the sleight of hand, sufficient numbers have subscribed to the snake oil, and 20+ year old houses which used to cost $20,000 are switching hands at $400,000 or more. The market's the ceiling.
The sad part of the episode is that the younger generation will have to perpetuate the shady exercise by taking the role of the subsequent investors in the Ponzi scheme of things. Why should they be mired in a fraud just because earlier investors drank of the Kool-Aid?
Caught between a rock and a hard place, the Minister for National Development could do the morally right, and effect a proper spring cleaning. He should be aware that many of the younger generation will be coming of voting age in 2016.
Unfortunately, instead of roaring into action, the mouse squeaked. Khaw Boon Wan told participants at an Our Singapore Conversation (OSC) dialogue on housing that he wants to lower the prices of flats by just "a few percent" over the next few years. His (selected) audience was objecting to selling back new flats only to the the Housing Board as this would limit the profit home owners can make. These are obviously not the needy people in dire need of shelter. Or assistance from public subsidy to stay out of the rain.
"If you want to sell a flat for $700,000 or $800,000, how can we stop you? No way". He says that, in accordance to his principle, he does not oppose the idea of subsidised EC (executive condominiums) owners making a tidy sum when they sell their units. To be rich is glorious, Deng Xiaoping would be so proud. Social inequality, Gini coefficient, all will have to take a backseat while this man is in charge. That's the golden rule in play: He who holds the gold, makes the rules.
In our context, the lure of asset enhancement has given licence for the authorities to inflate public housing prices, via the mechanism of linking to private property rates and some mysterious accounting entity called "land reserves". Whatever the sleight of hand, sufficient numbers have subscribed to the snake oil, and 20+ year old houses which used to cost $20,000 are switching hands at $400,000 or more. The market's the ceiling.
The sad part of the episode is that the younger generation will have to perpetuate the shady exercise by taking the role of the subsequent investors in the Ponzi scheme of things. Why should they be mired in a fraud just because earlier investors drank of the Kool-Aid?
Caught between a rock and a hard place, the Minister for National Development could do the morally right, and effect a proper spring cleaning. He should be aware that many of the younger generation will be coming of voting age in 2016.
Unfortunately, instead of roaring into action, the mouse squeaked. Khaw Boon Wan told participants at an Our Singapore Conversation (OSC) dialogue on housing that he wants to lower the prices of flats by just "a few percent" over the next few years. His (selected) audience was objecting to selling back new flats only to the the Housing Board as this would limit the profit home owners can make. These are obviously not the needy people in dire need of shelter. Or assistance from public subsidy to stay out of the rain.
"If you want to sell a flat for $700,000 or $800,000, how can we stop you? No way". He says that, in accordance to his principle, he does not oppose the idea of subsidised EC (executive condominiums) owners making a tidy sum when they sell their units. To be rich is glorious, Deng Xiaoping would be so proud. Social inequality, Gini coefficient, all will have to take a backseat while this man is in charge. That's the golden rule in play: He who holds the gold, makes the rules.