DBS CEO: 2 RISKS YOU HAVE TO KNOW

DBS CEO's recent earning call was nothing short of enlightening. Especially so in his single powerpoint slide on tail events. 

Two things make up that slide:
1. Large one-offs e.g., a large corporate collapse

2. Sharp RMB devaluation in the next three months

What's the probability that these two risks materialise? Nobody knows. But views that the yuan's devaluation is only beginning are abound. 

Sit tight folks.

HOW CAN A YOUNG COUPLE GET A UNIT AT BIDADARI BTO...AT A HIGHER CHANCE?

Now that everyone is gunning for the Bidadri BTO, how can you, as one half of a young couple ensure that you have a higher chance at getting a unit?

This checklist comes in handy:

1. Are you a 2nd-timer as a HDB home buyer?
2. Do you intend to have a child at all?
3. Do you intend to have a child within the next 5-10 years?
4. Do you intend to live with your parents/siblings/grandparents at Bidadari?
5. Do you intend to sell your unit when the Minimum Occupation Period is up?

If you had answered 'No' to all four questions, then you should right-size now to a 3-room. This enables you to have a higher chance of getting a better shot at a unit at Bidadari.

95% of 3-room units at a Mature estate BTO are allocated to 1st timers. That's you. And that's the reason why there is currently 10 units for every 6 applicants in the current BTO exercise as of now.

Judging from history, the application numbers for 3-roomers may go up a bit at the end of the close of applications, but it sure beats the low chances of the 4 and 5-room applicants.

I half-suspect the higher pricing of the overall Bidadari exercise is turning off some people too.

So, there you have it. Right-size and stand a higher chance. You have less than 24 hours.

Good luck.

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BIDADARI BTO - NOV 2015

Ok. HDB's launched the latest May 2015 BTO. But seriously, the happy bits are not there. It's in the Upcoming Launch section where it featured Bidadari Estate as one of the two areas on offer in Aug Sep Nov 2015.

The key phrase which you have to take note of is: In Toa Payoh Town.

This probably makes it a mature estate. And prices commensurate to that of mature estates i.e; more expensive.

Over 2000 units are on offer. But they are not the choicest of all. One plot is pretty near a mosque. All require the crossing of a road to get to Woodleigh MRT station. But this could be an over or underpass.

If you take a look at the URA masterplan and HDB provided map, the plot with 530 units of 3R and 4R is overlooking the lake. That is if the flats have units facing the lake. It should be quite the top pick amongst early selectees.

The only upside for Woodleigh MRT is it's a stop away from Serangoon MRT, which is the interchange between NEL and NSL. Otherwise nothing much.

It's also anybody's guess as to what the blue 3.5 commercial/residential plot would be in the future. 

The pricing as listed on HDB's website is appended above. It seems to be about 15-20% more expensive compared to the recent mature estate BTO at MacPherson Spring. I am not sure what commands this premium. Proximity to town maybe? Bidadari's Woodleigh MRT Station is 5 stops away from Dhoby Ghaut (via NEL) while MacPherson is 5 stops away from Bencoolen and 6 from Fort Canning (via DTL). You decide.

Cheerios.

Update: The income ceiling has been raised by HDB to $12,000 with effect from this BTO launch onwards. You are likely to see more applicants in the pool from now onwards. So what can you do? Nothing. Just pray harder.

Update 2: This BTO has been postponed till Nov 2015. Why? Probably to allay concerns that there are no more affordable homes per BTO exercise?

Update 3: Have included the pricing as listed on 17 Nov 2015 on HDB's website. 

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SPH 1H RESULTS

Not very bright I must say. And to keep up with its dividend payment of 7cts, I am not sure how much it is digging into its own pockets.

The more worrisome thing is this.

It may not be new. But it just makes the newspaper business much more of a concern for me. By lumping it with other media related subsidiaries and associates make things a bit more opaque. 

Look at it this way, circulation numbers have been the same over the years. But the Singapore population has been rising. 

What gives?

SINGAPORE SAVINGS BOND...THE NET EFFECTS

The Monetary Authority of Singapore (MAS) has released more information on the Singapore Savings Bond (SSB). I will leave you to click on the link to find out more about the SSB.

But what's the effects of issuing such bonds?

1.  Another debt instrument is launched to borrow from the public. This time, aimed specifically at individuals, made easier to procure and with 'safeguards' to assure the retail investor.

2.  As suggested by the Business Times article, the SSB would give fixed depos a run for their money. I think it will also grab some share from the ordinary savings accounts, dividend yielding counters on SGX and perhaps even some ETFs. The example cited in the SSB link mentioned a range of 0.9 to 3.3% returns...averaging 2.4%. It should be close.

3.  Banks will likely react. Stocks may drop further to increase their yields and attractiveness.

4.  Will MAS raise rates sans the Feds? Maybe?

SIDEWAYS

The past 12 months have seen an upswing in local and foreign equity markets. By foreign I mean USA, European and Asian ones.

I suspect markets have been pumped in the last one year for institutions to offload at their convenience. It does not help that ECB has started on their bazooka move of QE. But it is still early days as to whether it is any effective.

I see next week's 18 March FOMC meeting as crucial as market watches look to the FEDs for signals to raise rates. However, I am of view that most people are looking to the wrong thing. Interest rates will rise, it is only a matter of 'when'. To me, it does not matter if it is June or Sep 2015. I am not going to trade the markets in those three months of respite if rates rises only in Sep. 

I will just sit pretty and watch the slide. 

SOME THOUGHTS ABOUT THE iWATCH

The smartwatch industry has been receiving interests and hype these few days with the introduction of Apple's iWatch. 

But let us take a step back. Recall a few months ago, a flurry of smartwatches were launched by various mobile phone makers. The launches did not gather much traction amongst techies. The moves by the competing phone makers could also have been made in anticipation of Apple's big launch. 

So how will the iWatch perform in terms of sales? I will attempt to make the call here. Dismal.

Why so? With the advent of mobile phones since the late-90s and early 2000s, watch wearing has been slowing losing favour. Even among regular watch wearers. One could tell the time simply by fishing out the mobile, and along with it, texting friends and surfing the net. The flicking of the wrist and pulling back of a shirt's sleeve was a habit reserved for the die-hards, me inclusive.

Of course, there are people who wear watches for various purpose such as participating in outdoor activities, high-fashion tastes, admiration of certain watch brands, horological pursuits etc. However, these people will not find their requirements fulfilled fully by the iWatch. It is not rugged enough, not long lasting in terms of battery life, and has minimal brand recognition/affinity and most importantly, perceived value with horological fans. 

I remembered reading somewhere some time ago that if you launch a product that is so so so good, there will be enormous demand for it. I think Apple wants to head down that route. But I am not sure if the iWatch is good enough.