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I got this spreadsheet from a friend and was asked how to calculate the yield numbers. All are callable. I can calculate it as (100/40.85)^(1/(2050-2023)) -1 + 0.0 = 0.0337, which is more or less accurate. I believe the first item, one buys at 40.85 and get 100 at 05/15/2049 or until it's called, gets nothing in between. Number 4 I calculate it as (100/80.7)^(1/(2050-2023)) -1 + 0.0225 = 0.03047, which is 10% off. What is the formula? As for the trade, one pays $80.7, gets $2.25 each year, then get back $100 at 08/15/2049. Is the trade correct? PRODUCT CLOSING PRICE CLOSING YIELD CURRENT BID YIELD CURRENT BID PRICE/SIZE CURRENT ASK YIELD CURRENT ASK PRICE/SIZE MATURITY CALLABLE CUSIP MOODY'S S&P 1) United States Treasury 0.0 40.85 — 3.414% 40.2510 x $5,000K 3.376% 40.6520 x $5,000K 05/15/2049 — — — 2) United States Treasury 3.0 93.84 — 3.371% 93.5150 x $3,000K 3.360% 93.7000 x $5,000K 02/15/2049 — AAA — 3) United States Treasury 2.875 91.80 — 3.359% 91.4680 x $3,000K 3.348% 91.6540 x $5,000K 05/15/2049 — AAA — 4) United States Treasury 2.25 80.69 — 3.357% 80.3906 x $3,483K 3.343% 80.6060 x $5,000K 08/15/2049 — AAA — 5) United States Treasury 1.25 62.41 — 3.351% 62.1270 x $10,000K 3.336% 62.3260 x $10,000K 05/15/2050 — AAA — 6) United States Treasury 2.0 76.11 — 3.343% 75.8900 x $3,000K 3.333% 76.0430 x $5,000K 02/15/2050 — — — 7) United States Treasury 0.0 39.83 — 3.374% 39.3400 x $5,000K 3.332% 39.7960 x $5,000K 05/15/2050 — — —

I am curious, my one and only property has around 30% loan based on todays valuation. Currently housing loans are like 1% interest rates. Should I refinance and borrow MORE money from the bank and dump it into some "safe" investments that has returns like 2-3%? Maybe some government bonds? or something? Some form of investment that is Even 2% per annum profit should be significant.

Title : Two town councils invested S$12m in Lehman-related structured products By : Date : 17 November 2008 1646 hrs (SST) URL : http://www.channelnewsasia.com/stories/sin.../390407/1/.html SINGAPORE: The financial health of two Singapore town councils remains in the black despite their investments in failed Lehman-linked structured products. Holland-Bukit Panjang and Pasir Ris-Punggol Town Councils invested a combined S$12 million using their sinking funds. Going forward, the co-ordinating chairman of PAP town councils, Dr Teo Ho Pin, said future investments will remain diversified but will be on the conservative side. Just like thousands of Singaporean investors who have lost money on failed Lehman-linked structured products, the Holland-Bukit Panjang Town Council may lose its S$8 million investment. The town council invested 6.7 per cent of its sinking funds available for investment in Lehman Brothers' Minibond Notes, DBS High Notes 5 and Merrill Lynch's Jubilee Series 3 Notes. It had invested another S$3 million in Pinnacle Notes Series 6, but this investment was unaffected. For Pasir Ris-Punggol, its S$4 million investments in the Minibond Series 2 and 3 amounted to 2.6 per cent of its funds. Based on the 14 PAP town councils' latest financial statements submitted to the National Development Ministry, these investments amounted to 0.6 per cent of their total funds of S$2 billion. Like many others, the town councils are anxiously waiting to see if the Lehman Minibond notes will be making dividend payments next month. Dr Teo Ho Pin, chairman, Holland-Bukit Panjang Town Council, said: "If there is a credit event that occurs next month for the Lehman Brothers' Minibond, then that will be a default and... there'll be a loss on that investment." Town councils can invest up to 35 per cent of their sinking funds in financial instruments like equities, corporate bonds and funds. Holland-Bukit Panjang Town Council said while its investment income will be reduced as a result of the failed investment, its financial status remains in the black and improvement works will not be affected. During a six-year period starting from 2002, the return on its investments totalled about S$24 million. As of March 31 this year, it also has a total kitty of S$118 million. Over the last six years, the Holland-Bukit Panjang Town Council made a healthy investment return of more than four per cent every year. This is well above the average fixed deposit return of 0.9 per cent. With the investment income, the town council has been able to deal with the impact of inflation. Dr Teo continued: "Our assurance to our residents is that the sinking fund is still intact. We have adopted a very prudent approach in terms of investing our funds. "We have to continue to adopt a diversified investment strategy so we are able to achieve healthy returns for our town council funds, cyclical maintenance purposes and we have to balance between investment risk and returns." Six other PAP-run town councils also have exposure to Lehman Brothers through their fund managers' investment portfolio. These investments total some S$4 million and account for less than one per cent of each town council's funds available for investments. The National Development Ministry said it has no plans to amend the investment guidelines it has put in place as town councils are in the best position to decide how to manage the funds. Senior Minister of State for National Development Grace Fu told Parliament on Monday it was not practical nor desirable for the ministry to be overly prescriptive in enforcing the guidelines, which seek to achieve an optimal balance between reasonable returns and financial prudence. Hougang and Potong Pasir Town Councils, the two that are managed by opposition MPs, have earlier said they do not have any investments related to Lehman Brothers products and their sinking funds are not affected by the failed financial instruments. - CNA/vm Copyright

Feb 18, 2009 Nationalise US banks Mr Greeenspan said it will be necessary to temporarily nationalise some banks for a swift and orderly restructuring. -- PHOTO: ASSOCIATED PRESS NEW YORK - THE US government may have to temporarily nationalise the country's banks until the sector is reformed, the former chairman of the US Federal Reserve, Alan Greenspan, has said. In an interview with the Financial Times published on the paper's website on Tuesday, Mr Greeenspan said 'it may be necessary to temporarily nationalise some banks in order to facilitate a swift and orderly restructuring'. Long one of the world's most powerful proponents of hands-off financial regulation, Mr Greenspan indicated nationalisation may now be necessary. 'I understand that once in a hundred years this is what you do,' he said. Widely hailed while in office, Mr Greenspan has seen his legacy tarnished since he stepped down in 2006, as critics accuse him of failing to head off the current economic malaise. 'In some cases, the least bad solution is for the government to take temporary control,' he said. Mr Greenspan's call came as President Barack Obama on Tuesday proclaimed he had begun the work of saving the American dream, as he signed into law a historic US$787-billion (S$1.2 trillion) bill designed to rescue the US economy. But US stocks plunged on fears the mammoth bill, a new plan to tackle mortgage foreclosures expected on Wednesday and a fresh effort to save decrepit US automakers would not be enough to end the worst economic slump since the 1930s. Mr Obama, on a visit to Colorado, put his name to what he termed the 'most sweeping' recovery package in US history, which cleared Congress less than a month into his presidency, but with negligible Republican support. 'We have begun the essential work of keeping the American dream alive in our time,' Mr Obama said. The president, who has been warning darkly of economic 'disaster' without quick government action, adopted a more hopeful tone as he signed the bill, which may have deep implications for the success of his presidency. But US stocks plunged as investors worried whether government action would save the ailing economy, with the Dow Jones Industrial Average down 297.41 points (3.79 per cent) to 7,553.00 at the closing bell. -- AFP --- Will Temasek's investments in US banks be totally wiped out when they are nationalised?

From ST today: Mah: "Town councils must be accountable to their residents for what they do with the money they collect from them..." ie. Not the government's problem but the junior staff's (Remember the MSK case?) Further down... Mah: "The Govt stipulates that 20-25 percent of money collected from monthly service and conservancy charges must go to a sinking fund." Therefore, it means that (1) The govt is ultimately the one at fault (2) We are over-charged by AT LEAST 25% for our monthly conservancy charges. Why? Did we approve them to use our money for this purpose???!!! What other things are they hiding from us???

Have you ever wonder why are the town council allow to have such huge reserves such that they can invest in these failed bonds? Wouldn't it be prudent to put them in fixed deposit. Now I just hope that there will not be an increase in conservancy and hopefully the relevant town council will stand up and answer to us. The best thing that came out of this financial crisis is that we now know how much money the Town council are holding. Who's next???

I have been advising people to avoid Dual Currency Investment for the past year. My views are stated in this FAQ: http://www.tankinlian.com/faq/duali.html This type of investment allows you to bet on currency movements. You stand the chance of a big loss when the currency moves against you. You only get a small return (in the form of a higher interest rate) when currency moves in your favour. Recently, the AUD dropped by 30%. Those who were "long" in AUD lost 30%. But those who were "short" in AUD did not gain 30%. They only gain 1% or 2% in higher interest. The bank keeps the remainder of the profit. I learned to my horror that unsophisticated investors were asked to invest in "leveraged" dual currency investments. The bank lends them 4 times of their investment, so that they can take 5 times of the risk. If the currency drops by 20%, their total investment is wiped out (i.e. 20% X 5 times). The relationship manager of the bank who sold the leveraged DCI earned 5 times of the commission on this product. But, it wiped out the total savings of the investors. Someone told me that her mother lost $500,000 on this type of investment. Another retiree told me that he lost $150,000 in 2 months, out of the invested sum of S200,000. Do not invest in any of these products. Be careful about the advice of the relationship managers. Now I know that why my RM can afford to drive a bigger car than me. Do you the difference between a finacial banker and a pigeon today? The pigeon can STILL make a "deposit" on a BMW. I tried to get cash from the ATM today but it said "insufficent funds". I dont know if that meant them or me.

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