If you lose ....

[K2desoog]

... money investing in the stock market, you can demand your money back??
And while at it, stage a protest?

WTF? REALLY?

FYI, this article gave me the impression:
http://sg.news.yahoo.com/afp/20081011/tap-finance-banking-us-singapore-protest-06f3cb7.html

 

[Phil]

I'm not expert on stocks, shares and the works.

But I know that there's a distinction between the different shares/bonds and whatnot.

Most likely these people who are staging a protest are those that invested their money in the bank, with the bank promising higher guaranteed returns. Which, they didn't deliver.

It's just like those Prudential investment schemes that I've signed up for. You invest a certain amount of your salary monthly. The money in turn goes to the company which uses the money to invest in whatever they see fit. They guarantee you a higher return, and you can take the money out anytime you want. Or after a certain number of years, depending on which plan you take up.

These schemes generate much lower, slower and regulated returns, as opposed to those on the stock markets. Where you can earn big bucks overnight, or similarly, lose big bucks overnight. Of which is a different ballgame altogether.

All in all, I know I'd be incensed if they tell me I've lost all the money I've invested in their schemes, of which they promised a guaranteed higher return.

 

[widdly]

Yeah but there was no guarantee. It was Low Risk not No risk.

 

[fgl]

Things is .... everybody wants to make $$$$ and despite our financial advisers "advise" ... things can take a turn for the worst any time...

I gave up my portfolio some time back despite my agent's advise - "oh this is a 20 year thingy - cannot just see short term" blabla bla ....

There is always an element of risk in any investment

 

[dearxarson]

investments, in any forms, will yield risk. and any cash values projected from any investments will be non guaranteed (tho some will have both a non guaranteed and guaranteed portions).
at the end of the day, the investor must be able to "tahan" the risks' involved

what happened during the rally was that the investors were not happy due to the unethical way of selling and marketing that the banks did.

investments is just ONE of the MANY options we can use to plan for our future.

the sad part abt the rally was that many of the investors who came down to protest were nearing their "golden" years, and the moonies they used to invested on minibonds and pinncale bonds were for their retirement or children's education.

 

[guitarsan]

Isn't DBS one of those banks involved? Anyway, DBS is likely to get away with it because it's "government linked".

 

[rottenramone]

that's why u should use the money and buy as much gear as possible. screw your kids' education.

 

[K2desoog]

that's why u should use the money and buy as much gear as possible. screw your kids' education.

Good idea. As an investment...
They can sell all your gear off seeing that they're 'collectors items' by the time you're dead & gone. LOLz.

But seriously, you're joking, right? :???:

 

[wyldeboon]

that's why u should use the money and buy as much gear as possible. screw your kids' education.

yeah!!!!!!!!!!!!!!!!!

 

[shinobi]

ok, to be clear, this is how investment goes-

when you invest your money in a company, you are buying the shares of a company. this means that you own a part of the company. how much of the company you own depends on how many shares you have purchased against the total number of shares issued (sold) by the company.

now for illustration, let me tell you a story

lets imagine there is a company called Sperm Bank. Sperm Bank is worth 10 million dollars. they decide to split their company into 10 million parts (shares), and sell each part to the people (investors). this means each share is worth $1.

now the CEO of Sperm Bank is actually a chimpanzee. but this doesn't bother investors because Sperm Bank is so famous. still, sperm bank makes heavy losses and the company is now only worth 5 million dollars now. having issued 10 million shares, each share is only worth $0.50 now. the investors are now banging their balls (no pun). they still own the part of the company that they paid for in the past. but if they tried to sell their share (now you know why it's called 'shares'!) of the company, they can only sell it today at half the price they bought it for in the past. this is what you call paper losses.

now enter a big, greedy investment company called TEmaXAS Hold'em (TH). TH has alot of cash to invest because they hold the retirement savings of all the citizens in their country.

TH looks at the price of Sperm Bank shares ($0.50) and says "that's really cheap! lets buy them up! in the future CONFIRM go up! SURE make money! after all, Sperm Bank is so famous, they can't possibly fail!

TH buys lots and lots of Sperm Bank shares. Sperm Bank makes even more losses and their share price falls. good, EVEN cheaper, so TH buys even more shares. after all, sure go up eventually. Sperm Bank shares fall even further. my god, where is the bottom?!

in the end, Sperm Bank is in such deep shit that they are on the verge of bankruptcy. if sperm bank goes bankrupt, TH will be owning a part of a BANKRUPT company, which is worthless.

fortunately, Sperm Bank is rescued when big Bank of Angmokio buys them over. what used to be a big part of Sperm Bank is now a small part of Bank of Angmokio. oh, and Bank of Angmokio is losing money as well, but the government gives them money to help sort out their problems

 

[soft]

shinobi

Who makes the profit in your story?

 

[dtrulez38]

i guess it's a chain reaction...no clear profitter...
sperm bank invests in other companies, such as buying equipments to produce sperms, invest in r&d to produce better sperms, blah blah blah...
n equipment companies invest in other companies too...n the list goes forever...
therefore u can't really see where the money goes...no clear picture at all...
since it's a chain reaction, in the end if a big company goes down, many others will b affected too...

just take AIG for example...they're not operating on their own...many other banks or insurance companies invest(ed) in them too...tat's y when they're facing troubles, many insurance companies from other countries go down too...

correct me if i'm wrong...=)

 

[dearxarson]

the sperm bank example was really bad.
nothing is as simple as it seems when it comes to investments.

 

[Santa]

Lol - in this recession - hardly any winners! sad eh.

lets hope gear prices go down !

 

[vx02]

so what happened to the chimpanzee?

 

[shinobi]

shinobi

Who makes the profit in your story?

that depends on the period of time. i may own toilet paper today but in a few years down the road when the storm is over, i may make money in the end. looking back, there would have been a period of time where people were making money, and decidedly cashed in all their investments before things started to go bad. but a good investor believes that he can beat the market, that he can always win in the short run.

the sperm bank example was really bad.
nothing is as simple as it seems when it comes to investments.

omg of course in real life it's not that simple lah. why do you think i cited imaginary examples. if i went into fine details and considered all factors then i might have well have mentioned real-life examples. but firstly i'm doing it for kicks and can't be bothered, secondly i might not even be able to or it might not even be possible to arrive at a one-answer-says-it-all solution, and thirdly the point that i am putting across can be done so equally, if not more effectively with the use of artificial examples. without the basic gist of things how do you expect one to make sense of complex real-life situations?

i guess it's a chain reaction...no clear profitter

it is possible to make profit in such times, but it is extremely difficult and most of the time it is down to luck. especially in singapore where naked short-selling has been recently banned by law a few weeks ago. i will not explain what naked short selling is, because my explanation will not be chim enough and i will kena

but basically, when shit happens, everyone is affected. but consider that when times are bad, some companies make losses, some make heavy losses, and some go bankrupt. there are so many reasons why. but some of them can be managed. risk can be managed

so what happened to the chimpanzee?

http://www.youtube.com/watch?v=tLs5ZcZFLYU

 

[shinobi]

Lol - in this recession - hardly any winners! sad eh.

lets hope gear prices go down !

ahhh gear getting more ex due to exchange rates... don't remind me!

 

[K2desoog]

Tks for trying to explain. Its cheeem but i get a rough idea.

IMO investsments are sort of like 'gambling' (can't find a more subtle term)...

You put your money down (invest) and hope to make a profit based on the fluctuations of the economy/stock market except that in this current scenario you can ask the gahmen to help you get yr money back?

LOLz. FWIW, forgive my naitivity (sp?) but what CXXP.
You lose, you lose lah.

 

[bluepowder]

Ok ...lots of information which is very 'borderline' here.....

To answer the OP, the story in question basically states this....

A lot of people basically went to put their money in fixed deposits, however, the financials advisors advised them to put it in certain investment products(high notes)...that would give them greater returns....it is very important and is actually mandatory(MAS Requirement) for the advisor to explain all the risks of doing this....now the high notes seem to be low risk products which offer slightly greater return than fixed deposits...most financial advisors do not bother to explain the risks related to low risk products because they are in a hurry to sell them for commission....the risk being low does not eliminate the risk at all...a responsible advisor would have advised the client about things like Default Risk(which is basically what happened)....ie.Lehman defaulted on their products ...this happened because they filed for Bankruptcy under something known as Chapter 11 which basically kinda says they do not need to pay the returns for the product we are referring to....

If the people who are protesting....signed a waiver saying they have been explained the risks(mentioning the risks we talked abt)....there is nothing that can be done for them....really...its quite stupid to sign something without knowing what it is....

however if there was no waiver or anything...there might be an interesting situation.....

Even when you put your money in a bank..which is considered the safest....you still encounter default risk and most banks only guarantee a part of your money....

Maybe those old ladies who store all their money in the safe were right to begin with....but then its always them who complain most about inflation...

 

[shinobi]

there are alot of risks here and there when dealing with money. but that is where regulation plays a part.

anyone who buys an investment product is allowed by law a 14 day window period to return it to the bank if he changes his mind, without any charge. that however, does not include any losses on the investment incurred during that period.

if you ask me, i think that those people complaining knew EXACTLY what they were doing. with egos bruised from some greed and lousy investment decisions, they decided to push the blame to the banks.

because you know those old ladies... they can't be wrong