Monday, January 13, 2014

"Why Singapore's economy is heading for an Iceland style meltdown" writes Jesse Colombo in Forbes Magazine 1/13/2014

Ladies and Gentlemen,

If you thought that Singapore will continue to ride the waves, to borrow a phrase from the British Empire, I am sorry to dampen your spirits.

I want to refer you to an article in Forbes Magazine of 1/13/2014 which has this very foreboding title "Why Singapore's economy is heading for an Iceland Style meltdown".

It says "In 2007, Iceland was celebrated for attaining the world’s highest standard of living according to the U.N.’s annual Human Development Index report. In less than a generation, the tiny North Atlantic island had transformed from a traditional fishing and tourism-based economic backwater into a finance and banking powerhouse, rocketing the country’s wealth and living standards to enviable new heights. Sadly, Iceland’s economic boom was an illusion based on a reckless credit and asset bubble that led to a terrifying financial crisis when it popped in 2008."

Please see

The article compares the Iceland Bubble to what will happen to Singapore which it says is very similar in it's characteristics. Singapore he says is populated extensively by opportunists, speculators and profiteers who are stoking the frenzy in property prices which has gone through the roof, far ahead of it's real worth. He then says that the neighboring Asean countries from which most of this money comes are themselves over invested and themselves in bubble economies and are themselves unstable. When their bubbles pop, which he believes will inevitably happen sooner than later, so will be the Singaporean one.

He says the property market in Singapore is itself over-extended with far too many properties with even more properties in the pipe line. This, according to him, will result in an oversupply of properties which will result in a collapse of the real estate market and will itself extend to the rest of the economy.

He also refers to the huge borrowing of Singaporeans to finance their property purchases which can amount to as much as 60% of their income, not for using it as dwellings but purely for speculation. This unrelenting upward push of property prices by gamblers in the assumption that it will always be Charlie Boomtown, in an island no bigger than 710 sq. km, with nothing there  is simply suicidal.

If you thought about it, Singapore is just a lot of hype and hot air with very little substance. It is simply a place where profiteers and speculators come to make a fast buck. Thanks to the never ending hype and glitter put out by the government state owned media, of course from the outside it seems glamorous. Other than offshore banking and money laundering which has attracted all the world's finance executives to Singapore to service the illegal assets of Colombian and Burmese drug lords, the ever expanding building construction sector and tourism, there is nothing else besides.

With a foundation as hollow as that, it cannot expect to continue economic expansion indefinitely. The bubble has to burst and burst it will, leaving your property worthless.

In my earlier post of  "Singapore's property bubble; cause for alarm. HDB property owners beware" of Dec 23, 2013, I had said Singapore's HDB (government housing) lessees should beware of their properties becoming worthless and should sell now before it is too late. Especially since 90 year old Lee Kuan Yew is about to die and the island will suffer serious instability as a result.

This Forbes Magazine report on Singapore's false economy confirms my prediction of things to come. And it is not going to look nice.

I am not an economist, as I am a lawyer, and cannot say with any authority about these things. But you don't need to be one to see how bad it is. Huge numbers of young men walking around during lunchtime in shirtsleeves and neckties in downtown Singapore island and pushing pens in offshore banks cannot really support all this glitter and glass. It should be obvious to anyone with eyes.

Once again, clear out now when you can. Sell your HDB flat and clear out before it is too late.

Gopalan Nair
Attorney at Law
A Singaporean in Exile
Fremont, California USA
Tel: 510 491 8525


JJ said...


The link to the article in the Forbes website is incorrect. Please check.



Anonymous said...

Sorry to go off topic.... SG hospitals are running out of bed space apparently and are creating make shift wards or doing hospital transfers. Its scary that the policy makers did not consider infrastructure before opening the flood gates. All Hail.... to the almighty President scholars.... kneel, kneel....

Gopalan Nair said...

Hello JJ or Jamshed,
Thanks for pointing out the boo boo. It has been corrected and filed.

Lim Chin S said...

Singapore economic collapse is imminent.
Absolutely, leave NOW while you can or curse and repent in poverty.

Anonymous said...

According to a Singapore Polytechnic survey six in 10 young people have considered looking beyond Singapore to achieve their dreams. Mind you this is a survey conducted by a government run institution. One wonders what the actual figures would be like in a survey conducted independently of the government.

Peter Zuellig said...

You can blow up a balloon for only so long. While the Lee family have conducted their own style of corruption in a covert way, it's beginning to fall apart, thank God.

Anonymous said...

I would advise Jesse Colombo not to take the bait and visit Singapore.

The government and its supporters do not take kindly to external criticism.

He could find himself in jail.

Anonymous said...

MAS had recently rebutted against Jesse Colombo's article.

Faith said...

I hope it lasts for the next 2 years at least, so hopefully I'll be in an overseas university by then and can escape the demise of this dire economy. ><

Alex Wan Wai Yung said...

Singapore is going to the dogs. I advise all Singaporeans to try and obtain a foreign passport as soon as possible. I have a Canadian passport as a life insurance.

Anonymous said...

Thank you for posting this.

I agree that all Singaporeans should move overseas. I feel so grateful that I am a American Citizen and to sad to hear Singaporeans bitch how bad Singapore is.

The more I read this blog, the more gratitude I feel being an American citizen everyday. I cherish the freedom and balance what United States offers that Singapore doesn't.

Singapore is such a pity with a benevolent dictatorship. You should fight for your freedom and not just go for your money.

Samuel Curtis

dany said...

to mr gopalan nair

U r just jealous of singapore's economy, doomsday prophets have been prophesying singapore's doom for too long but nothing has happened, just enjoy ur stay in US and don't whine about singapore

Anonymous said...

Its obvious dany has not been looking what has gone on and is still going on around the world and the real state of economies. Singapore is a trading economy and as all economies are on the downturn elsewhere , Singapore will be affected .