Sunday, April 15, 2012

Lim Chong Yah's wage shock therapy for Singapore economical restructuring good for Singapore Stocks Market?

Lim Chong Yah, father of top corporare lawyer Lim Suet Fern, father-in-law of PM's brother Lee Hsien Yang has drawn much comments over his proposal of economic restructuring which mainly centre on increasing wages of workers earning $1,500 per month and freezing wages of high-earners earning more than $15,000 per month for 3 years.

I will not delve into details more on the pros and cons of Professor Lim's economic proposal as I am not an economist. However as an investor, I think that if Prof Lim's proposal is to be implemented, the rich (those earning $15,000 per month) will see their salaries being reduced due to wage-freezes and growing inflation of Singapore; the rich may then seek for better returns of their monies: they may turn to high-yielding stocks like Reits or Telcoms and hence the stock markets may see a bustle of activity.

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