TR EMERITUS

American banks will face big problems with their mortgages. They offer 30 year mortgages at fixed interest rate. In the early 2010s, following the 2008 financial crisis, interest rates on 30-year fixed-rate mortgages fell to historic lows, often around 3-4%. In 2020 and 2021, interest rates remained near historic lows, with rates for 30-year fixed-rate mortgages often hovering around 2-3%. Assume that a bank had offered a fixed rate loan at 3%, and the rate has now increased to 6%, the value of the mortgage would have dropped 30% due to the difference in interest rate. If the bank had taken long term deposits at less than 3% interest, the bank would be fully hedged on the mortage and would not suffer any loss due to the change in interest rate. However, it appears to me (and I may be wrong) that the US banks are not matching the mortgages and funding cost in this way. The bank is taking a risk on changes in interest rate. If the bank has $100 billion in mortgages of 30 years mortgages issued at 3%, and it is not hedged with any long term fixed rate funding, the bank would have to suffer a loss of $30 billion on the mortgages. The bank does not need to recognize this loss immediately. They would have classified the mortgages are "held to maturity" and would be allowed to carry the mortages at "cost". This means that they will write off a loss over 30 years, i.e. the loss is their cost of funds for the year (at the market rate) and the fixed rate that they receive on the mortgages. The loss would be about $1 billion a year over 30 years. (The actual loss will be somewhat higher in the earlier years, and will reduce in later years.) However, if the bank faces massive withdrawals, they will have to sell their mortgages at the current depressed values and take an immediate loss on the mortgages that are sold. The recent sharp hike in the interest rate will cause many banks to suffer large losses. What happens if the banks issued fixed rate mortgages at high interest rate and interest rate dropped subsequently. In theory, the bank would have made a large profit on the mortgages. However, the banks had a practice of allowing borrowers to refinance the mortgages at lower fixed rates by paying a penalty. The penalty is quite low, relative to the change in value of the mortgages. For example, if the 30 year mortgages were issued at 6% interest and the rate dropped to 30%, the bank should have charged a refinancing fee of 30% (representing the difference in value of the mortgages at 6% and 3%). Instead, the bank charged a refinancing fee of 3% (or less). Home borrowers benefited by refinancing their mortgages at lower interest rate when the interest rate dropped during the past decade. When the interest rate went up sharply during the past year, the banks had to carry a large loss. I expect many banks in America to face serious financial problems. This will apply to the big banks as well.   Tan Kin Lian Disclaimer: I do not have a full understanding of how the banks finance their mortgages. This article may exaggerate the problem.    Read More →

I’m now in Vietnam for a short trip and I am being reminded of the time that my day job boss made a remark about how I only got a “serious” job at 38. He exclaimed “I don’t know how you survived before that.” I bring this topic up because, while Vietnam has made great strides economically, it’s still an obviously poor place and I’ve encountered all of two people begging (that’s from three days of this trip and three other weekly trips in the last decade). For the most part, the place is filled with micro-enterprises where someone turns a hole in a building into a shop selling something or other. These guys are the answer to how I survived before I got a serious job. They are also what you call the unknown reason as to why people become entrepreneurs. For me, I ended up as a “free-lance entrepreneur” because I didn’t have a choice. I had to do something to put money in the pocket. I had burnt out and crashed after my first job in a fly-by-night agency, which worked me the most ridiculous hours. It didn’t help that the girl I was with at the time decided that my job was her jealous competitor and would either call up crying or stalk me in the office. The average lifespan of someone in my job was three weeks (including the two week notice period) and I somehow managed to last four-months. However, when I went to look for other jobs, people didn’t see me as someone with four and half months of experience. They saw me as someone who quit too easily and given that there was a recession in 2001 and the advertising and PR industry had been hit, I wasn’t exactly anyone’s favourite choice to get hired. A friend from university days then suggested that rather than look for someone to pay me a salary, I might as well go straight to the source of the money – the client. I remember my first client being a Holistic Living festival. Made all of $400 from the job and then I picked up a client called Tempur, who made the most expensive but the most interesting sleep materials. I spent slightly over a decade freelancing. I did have spells in agencies but somehow got myself fired after four months. I did try to teach and ended up resigning because I dreaded the bureaucracy involved (I am allergic to “committee meetings” and I can say with some pride that I never have been and never will be involved with committees again). Somehow, I managed to last a decade with no agency experience in an industry that only “respects” industry experience. One of the most fundamental questions that I was consistently asked during that period was “why can’t you get a proper job?” If I think back, I guess my answer was simple – no one wants to hire me (at the time I had a very patchy work history) and so I have no choice but to hire myself. Now, I failed to build anything resembling a business. However, I will make the point that the path of entrepreneurship isn’t a conscious choice. There are a few too many self-help books telling you that you are either an employee or an entrepreneur. Then, you live in Singapore, you get a government that believes that entrepreneurship is nothing more than a fancy word to show that you’re trendy and I do get the feel that the government tends to see entrepreneurship something it can offer the citizens as an alternative career. Truth be told, entrepreneurship is not for everyone. Too many people talk about it as the only way to get rich but ignore the fact that most of the journey an entrepreneur makes is long, hard work and the opposite of financially rewarding. Not everyone is cut out for that. However, that being said, there may not be a choice for an increasing number of us. The tech lay offs should be a very good indicator for many of us that the concept of a steady job isn’t so steady anymore. It’s even if worse if you happen to be over 45 and some bureaucrat in the accounts department in New York or London sees you as a costs to the CEO’s bonus. You can get culled and unfortunately, we live in a world where the HR department is not going to look at your “loyalty” or “skills and experience” but what you’re costing the company. An increasing number of HR departments look at a guy with skills and the fresh graduate with no skills and figure out that its cheaper to hire the fresh graduate and train him or her with the skills than to keep the old timer. So, an increasing number of us have to understand that we’re not going to have income security. We need to understand that we have to have something to sell regardless of our employment status. It’s as simple as sell or die. Governments talk about economic growth. Individuals need to talk about survival. Sure, at certain stages you may get a hand out. However, that won’t last forever. Always look for something to sell. When you’re in entrepreneurship mode, you stop looking at defending your turf and look for various angles to get something from a situation. For example, if you lose out on a job, do you sit there and complain about how unfair life is or do you find a way of getting something from the guy who got the job? An increasing number of working professionals will need to understand that they have to think like the food vendors on Vietnamese streets. Governments and corporations from elsewhere will not rescue you. The only choice is to always have something to sell or die.   Tang Li *Although I’ve been based mainly in Singapore for nearly two decades, I’ve had the privilege of being able meet people who have crossed borders and cultures. I’ve befriended ministers and ambassadors and worked on projects involving a former head of state. Yet, at the same time, I’ve had the privilege of befriending migrant labourers and former convicts. All of them have a story to tell. All of them add to the fabric of life. I hope to express the stories that inspire us to create life as it should be.      Read More →

This is a report from Germany, the home country of Biontech. There is a drastic change of Narrative now. The Health Minister has admitted that adverse events occured in at least 1 in 10000 Vax persons. In Germany, the government will compensate Vax injured a MONTHLY allowance based on individual cases. A major lawsuit is launched against Biontech which will start in April 2023, even though they are supposed to enjoy immunity under contract. The German Health Minister has admitted that he has talked rubbish of exaggeration when he twitted that the vax is "totally safe with no side effects". The tide has changed. It will definitely reach our shores. Karl Lauterbach is Germany’s Federal Minister of Health. Yesterday, he dropped a bombshell on Germans in an interview. It has been posted on Youtube with English subtitles. You can find the video here (start: 3:54; end:15:17 [interview with minister of health starts at 8:07). The COVID-19 ‘vaccine’-induced injuries that were covered in this program are severe, life-altering, and permanent. More people are waking up to the reality that more of these severe injuries have occurred and continue to emerge than what has ever been admitted publicly by those pushing the shots. This is the nature of passive monitoring systems, particularly when coupled with active dissuasion of reporting. COVID-19 ‘vaccine’-injured people are finding themselves falling between the cracks in health care systems. This is horrible, but unfortunately, is not news for most of us. The news agency and Minister of Health confirmed that the Pharma companies are free of liability due to ‘vaccine’ injuries. This highlights all that is wrong with the clinical implementation of vaccine technologies, but there is no news here either for most people. Governments pushed the shots on the public and the public paid exorbitantly for them to do so. Now, growing numbers of people are suffering severe side-effects, and the public is also on the hook to pay for these outcomes, which, by the way, were foreseeable to vaccinologists and many other scientists with integrity. Any way you look at it, taxpayers have lost and will continue to lose massive sums of money due to this global debacle. This will be ongoing for a long time due to the massive damage to the global economy. Unfortunately, most victims of COVID-19 ‘vaccine’ injuries are receiving a pittance for the severe harms they experienced. Worse, many injuries are not being compensated at all because those pushing the narrative are ultra-slow in acknowledging many of the clinical problems caused by the shots. Interestingly, Germany’s federal Minister of Health hopes the Pharma companies will voluntarily help to compensate those harmed by COVID-19 ‘vaccines’. “That’s because the profits have been exorbitant. Simply exorbitant profits.”, said Lauterbach. Rhetorically, is it at all possible that ‘exorbitant profits’ blinded common sense? Let’s see how much the companies donate! Here are some bombshell admissions that came from the chat between Lauterbach and the newsman, who did a great job of keeping the Minister of Health on the hook… COVID-19 ‘vaccine’-induced injuries are unique and often not amenable to traditional medical interventions! Research is required to figure out how to treat the unique injuries caused by the experimental COVID-19 ‘vaccines’ that are still in their initial phase 3 clinical experiments to assess their safety despite there no longer being any placebo-treated controls to facilitate the detection of safety signals! Government agencies need to get faster at recognizing injuries caused by COVID-19 ‘vaccines’; hard to do when all they can do is robotically and incessantly state they are “safe”. Government compensation programs are a mess, hence why Lauterbach felt compelled to say, “so I can see why the people here are making complaints”. “And we are slowly [yes, way too slowly!] gaining a clearer understanding of the situation”; meaning, ‘we are starting to recognize that way more people are ‘vax’-injured than what we have ever publicly admitted’! “So, you’ve always given the impression that side-effects aren’t really a thing.“ And here is the biggest bombshell of them all: With respect to severe COVID-19 ‘vaccine’-induced injuries, Lauterbach stated: “I’ve always been aware of the numbers. They have remained relatively stable. …1:10,000: some may say that’s a lot, and some may say it’s not that much.“   Goh Meng Seng      Read More →