Friday, August 24, 2012

A bit on financial prudence

My late mother used to say in Hokien, 'Bo lui kha ho peh bu kahsi' which means 'When one has no money, one will behave better than being disciplined by parents'. 

We wish for windfalls, the bigger the better, but many lucky ones were at a loss with their sudden wealth. In fact, being exceptionally rich in this way is likely to bring new problems like being sought after by relatives and friends with tales of need. It is also likely to create security problems when more people (including those with evil intentions) knew about it. There was even a case of death in an accident as a result of excessive alcoholic drinks while celebrating a lottery win.

I like the following graphic (except for the wrong spelling) on excellent quotes by Warren Buffet, the best known investor and among the richest in the world who leads a humble life...


especially the one on Spending.

We have seen how countries producing oil have squandered their easy money on wasteful projects. I was surprised to read of Petronas having to borrow money for their oil prospecting projects! Norway stands out as being the best in investing their oil revenues for their future generations. It has the largest pension funds in Europe, probably in the world.

To contrast Malaysia with Norway, I wish to point out the new capital Putrajaya was built from scratch with the creation of lakes so that beautiful bridges could be built. The capital of Norway, Oslo, has 40 islands within its city limits, and bridges were built out of necessity! Its history goes back many centuries ago...
"According to the Norse sagas, Oslo was founded around 1049 by King Harald Hardråde..."
http://en.wikipedia.org/wiki/Oslo

Just imagine how KL would have been better developed with the money spent on Putrajaya!
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2 comments:

  1. Anonymous11:04 am

    Yes, the bridges in Putrajaya costs more than a billion ringgit. There was only a small stream flowing through Prang Besar Estate, the site of Putrajaya. To build the bridges, they have to build a dam, which is just in front of the Putrajaya International Convention Center(PICC). As the river flowing into the man-made lake was polluted, they build a natural filtering system, which is now known as the Putrajaya Wetland Park. Incidentally this where they would be stationing the pandas. Plus all the river banks, roads bridges and embankments, a good estimate is more than RM 2 billion, just to have a lake in Putrajaya.
    This is creative spending. Buffet was talking about his own hard earned money. Here in Putrajaya, they are spending our money!

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  2. KoSong Cafe11:51 am

    Thanks for the useful information which explains more on my point.

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