Advertisements
Skip to content

Breaking the cycle. Else, we stay the same.

Posted in Personal Finance

Recently, I wrote about T20, M40 and B40 after I found out that when someone googled for it, they were somehow directed to kopiandproperty.com When I posted the article in Facebook, a good friend asked, ‘Why T20 seems to be growing faster than M40?’ I answered that it’s quite simple. The richer would usually have more wealth to build more wealth. That’s why the richer always become richer unless they did not invest or they somehow spent everything they earn.  Since we are at this topic, I asked my most knowledgeable friend, google and managed to do a few more readings and found some recent articles on this topic from all over the world. It’s very easy to just believe that the gap between the richest and poorest are happening only in Malaysia. When we believe this, then we stop taking actions to improve our situation. Well, let me be very direct. It happens in many countries and with the current speed of innovation, there would be even more people who would be left behind. There are many people who does not even know what is a technology start-up. Some are still wondering why an idea can be worth so much. Yes, there are even online start-ups which are STILL making losses but their CEOs are still paid obscene salaries. Let’s all learn from all these articles yeah.

A recent article in Hong Kong by South China Morning Post. 1.34 million people out of 7.34 million people in Hong Kong are living below the poverty line. This is around 20 percent of all population. Anyone earning lesser than HK$3,800 (RM2,063) per month would be considered as living under the poverty line. Do google to understand what is a ‘coffin home.’ The rental for such a home is usually HK$2,000 (RM1,086) per month. A report by Oxfam showed this, “In 2015, the median monthly household income of the top decile of earners was HK$100,000 (RM54,291), while that of the lowest decile was only HK$3,500 (RM1,900).” The poorest would have to work for 2.4 years in order to earn what the richest are earning in a month. The full article in SCMP here.  My earlier article here: Buy a Tesla or buy a micro-flat? Both similar ‘sized.’

A recent article in Thailand. It tells of how hard factory workers have to work in order to have barely enough for themselves and their family. The earning is around S$12.50 (RM39) per day. Assuming they work 26 days per month, it is RM1,014 per month. The increment for the past 4 years were just 5 Baht per day (RM0.64). Monthly, it is close to RM17. 1 percent of Thai controlled 58 percent of Thailand’s wealth. In a similar report like the one Oxfam published for Hong Kong, 10 per cent of the country’s richest people were found to earn 35 times more than 10 per cent of society’s poorest people. As per the World Bank, 69 percent of Thailand’s economy depends on export. This meant that the world economy would determine a lot the direction of Thailand’s economy. Here’s the full article in todayonline.com

I think we think the wealth gap in countries like Singapore should be much better. Well, here’s an actual article in channelnewsasia.com  What about that of Australia? This is a latest article on Sydney Morning Herald Of course, we must not run away from two other countries. This is one latest article about Britain in TheGuardian.com Widening of income gap. Where exactly is Malaysia in this inequality map? Here’s that Oxfam map with regards to inequality. We are ranked pretty poorly, at 106th place out of 151 countries. Lots to do! Singapore is also on the bottom half, at 86th position. Indonesia is 101st place. Thailand is close to the middle point, at 70th. Australia is 14th. (Very healthy, right?) Oh yeah, my earlier article about CEOs here. When salary packages for CEOs become way too high Strategists should usually be paid more than operations people but not at these levels… right?

I seriously believe that we have to do more for our very own M40 or B40 as well. This is the main reason why I disagree that subsidy should be for all. To really help those really in need, it must be very targeted. I personally also believe that perhaps financial awareness be taught to more people, not just those who wants to know about it but it should be to every university student. If possible, even to secondary students. Perhaps make it a compulsory module to pass? Regardless of the major they are in, if the new generation continue to be reckless with their money, especially as soon as they get their credit cards, very soon they would be in debt.  This happens next: 82,383 bankrupt Malaysians 2013-2016 In some advanced economies, those out of work are given subsidies. Frankly, I do not prefer this method. Teach them how to fish, not give them a fish every time they are hungry. Please do work hard, work more and all the best.

written on 5 Nov 2017

Next suggested article: Underpaid? Get a new job. Else, work your money harder

Advertisements

2 Comments

  1. Fred
    Fred

    It is obvious in life that when GDP is growing 5%, it means the general average growth is 5%. It is not only having more wealth to build wealth. The smarter ones will do much more than 5% and the less smart ones will be slower in exploiting the situations grow much less than 5% or just want to remain poor.These averages out as 5%. Only policy tweaking can taper off the extremes through taxes. These are realities of life. The smarter or richer gets richer while the poor or less smart will lag behind. Society has, through centuries used all sorts of means to change these positions or close the gaps. Education, businesses, politics, or marriage are means to change stations in life.

    November 6, 2017
    |Reply
    • Good comments. I always believe as long as one grab hold of opportunities and work on them, they would already do better than majority.

      November 6, 2017
      |Reply

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: