(30-07-2019, 09:57 PM)dreamybear Wrote: [ -> ] (29-07-2019, 08:32 PM)Bibi Wrote: [ -> ]I share the same sentiments as you and thats the reason why I had signed a form to trade overseas shares few months ago. Spore STI is like having a lost decade. For a decade STI is still not reaching its previous high in 2007. majority of shares here are also quite illiquid. I will be putting more money into overseas shares when opportunity arises.
IMHO, I also think S'pore has peaked, and already past its golden age.
The previous/older generations were the luckier ones in having seen remarkable improvement in their lives during the 70s/80s/90s:
- There were more career opportunities to be trained and to work in areas unrelated to one's tertiary education or job experience. I guess it's because in the past, S'pore was still an inexpensive country for companies, and there was a severe shortage of manpower due to its rapid industrialization. These days, it is more profitable for companies to go for a cost-effective foreign talent workforce.
Since capital is mobile and can move to where it is best treated, I think this is fair to consider whether Singapore is an ideal place for one's capital. Especially for a Singaporean.
Barring another industry-specific boom (oil & gas, electronics, real estate, etc), I agree that it is likely that Singapore's economy will not grow at the pace it had between 1970-2000.
I think the impression that the government likes to give us, that our neighbours are hungry to steal our lunch, and so we musn't be complacent and rest on our laurels, are quite reflective of the regional competition. Even though our neighbours have larger land mass and population, they recognise that their future growth comes from being bigger exporters, and not so much on domestic demand. In other words, their growth strategy is similar to Singapore's. This is particularly the case for Malaysia and Thailand. Where export industries are concerned, they are very aggressive in courting foreign capital, using policies that are very much more liberal compared to those regulating its domestic-economy industries.
Indonesia is slightly more unwilling to go down this same route because it has a much larger domestic economy with which to develop.
So while Singapore and her neighbours are all seeking to move up the value chain, Singapore has managed to stay ahead because of how the country is managed. It is more efficient and effective. But of course, there are costs -- though not necessarily financial -- to such a system. And these are borne by the populace. Whether such a system can be sustained is key to whether further economic growth is possible.
Assuming that Singapore's populace remains dogged in their economic pursuits, I am quite sure that she will remain ahead in the region. What will be the future growth drivers? Probably in things that we are already doing, but higher up the value chain.
What does this mean for Singapore's stock market?
Because of Singapore's lower growth potential, observers should not be surprised with its lower stock market valuation multiple. On a broad index level, the returns are likely to more or less track the gdp growth rate. But in specific industries, fortunes may differ vastly as the prosperity of each industry depends more on its global supply chain situation, than Singapore's domestic demand. Banking, petrochemicals, shipping, oil and gas, air travel, and electronics, are probably examples most can relate to. So there are opportunities for exposure to different regional/global industries. But since their fortunes may differ, investors will have to choose wisely.
So if the Singapore stock market is an aggregate of the health of regional and global industries, then a lackluster STI perhaps reflects a lackluster regional/global economy.
Though I do acknowledge that the animal spirits in other markets are stronger, and hence, seems to offer better, more exciting prospects.