Scarce resources

Why do I have this feeling that resources are more scarce than everyone in the world thinks. I think we are underestimating the amount of resources left in this world.

With this prolong probable L shape trend of the global economy, we have to know that resources are scarce and be humble. We should be humble on what we spend on, not on extravagance or veblen goods. Materialism that has taken over our human nature has damaged our brains. Look at the next few generation of future workers and you will see what I mean.

Look at the vast asymmetric information happening now in this world even though internet exist. Look at people graduating from unrecognised degrees. These people don't even know they are from LA or Panama? That is $10k+ my friends. Is this pure ignorance or a lack of self responsibility?

And there are plenty of schools and institutions offering management and financial courses. The supply for the next 3 years will be massive with demand having peaked is on a downtrend. And these people studying don't even know or are not afraid what would happen in the future. Is it because we are living too comfortability in Singapore that we know that the government will do something about it? The government will not entertain you.

What would the future beholds? Maybe I'm too pessimistic but the future certainly looks very bleak even without this financial crisis. Resources are becoming too scarce and that is why people have been talking about the commodities boom. The bubble has burst but it will not stop growing.

Inflation to come, War

With Central Banks pumping in so much money because they perceive it to be liquidity problems which instead should be about debt problems, and factories cutting down production, why wont it lead to inflationary times?

Factories around the world are scaling down labour, and that scaling down leads to high unemployment. With that, the people wont be able to buy, and the vicious cycle goes.

Next, there will be so much money floating in the system. It is like a sink with the pipe choked. There are alot of liquidity in the sink, but the water cannot flow because the pipe is choked. What would happen if the plumber finally unchoke the pipe and cause a large flow of water down the pipe?

Although the US dollar now is becoming stronger due to demand rather than on the fundamentals of the economy, its long term trend is most likely down. If it continues to strengthen, wouldn't the value of their debts be more expensive than before?

As countries are now becoming more self protecting, globalisation is stalled and diminishing. Could this turmoil turn out to be a sign of war in the coming years?

Because of the so called economic interdependence between countries, this does not mean that the probability of war is zero. If it is close to zero, why do countries allocate a significant amount of expenditure is weaponry?

Days of impossibility will be come possible. Impossible is nothing.

DBS to compensate customers

DBS, Singapore's biggest bank, fell 5.5 percent to S$10.96 after saying yesterday it expects to spend as much as S$80 million ($53 million) to compensate customers who bought products tied to now-bankrupt Lehman Brothers Holdings Inc.

Although this is bad news for shareholders in the short term, it is in fact a good news in the long term. Why? Because by doing this, it maintains its reputation which is important for banks. Without trust, the financial system cannot work.

By compensating, DBS acknowledge that they have made a mistake and is willing to be responsible. This will be one of the events that will shape DBS corporate governance and maintain its rationality to seek long term value for its shareholders instead of acquiring short term profits which is little in comparison to its overall value and reputation.