Rich Snail

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The ASEAN region is famous for its tourism, sandy beaches and colourful temples. But a new trend is emerging over the past few years where occidentals get on the plane not to enjoy hot sand and clear blue water - at least not in the first place - but to get treated here. Many hospitals in Thailand, Singapore and Malaysia are seeing an influx of tourists, especially Americans in their world class hospitals. You even have websites like www.malaysiahealthcare.com which purpose is to promote this trend !

To discover more on this very interesting phenomenon, I recommend the following read Operating profit. Of course, you know me, it is from the Economist. Otherwise this section would have a different title!

What I love about this is that it really embodies the power of liberalism and competition. The US system, which became inefficient and over-priced, better adapt or it will start feeling the heat!

It can be difficult to create a name for yourself these days. One of the surest way to do that is to stir the pot & go for controversy. It ensures that a few people will listen to you & the ones who feel attacks will respond. And there is only one thing worse than bad publicity - no publicity !

Some financial analysts used this strategy in the past. Funnily enough, they are ripping some of the benefits with the latest crisis. But there are other explanations why the doom profiters have had greater saying over the past few years. This week’s Buttonwood column shed some light on why doom-prediction is on the rise…

Bearish analysts are not all heroes. Sometimes they merely shout “Fire!” in a crowded theatre and feel vindicated when panic ensues. But their prominence is a healthy long-term sign for the markets, which proved as gullible about the health of mortgage lenders in 2005 and 2006 as they were about dotcom stocks in 1999. The best will survive, especially if they have the flexibility to turn bullish when the fundamentals improve.

It took me a wee bit more time than usual to read the Economist this week. Many reasons to that, some of them being work related, others being personal - those who know me well will understand easily…

This week extract from my Economist reading is the trouble with pensions article. It is on the lengthy side for an Economist article; yet its reading is, as always, a breeze. The subject describes the main pension system we find worldwide. Sometimes defined-benefit schemes will be supported by companies (UK / US), sometimes by government (France). The defined-contribution one is the preferred one for expats as it is seen as more flexible.

The article is on the pessimist side. Its conclusion speaks for itself.

When it comes to pensions, the buck has been passed from employers to employees. But too few workers realise how much they need to contribute to guarantee a decent retirement or feel confident enough about how to invest their funds. This will not lead to the headlines about bankrupt pension funds that marked the decline of the DB scheme. But it will be bad for many workers all the same.

My two cents worth: The only solutions to this problem is financial education. We need to help people realize the impact of their non-choice and lack of expertise in this area, and help them get the right attitude toward finance: pro-active! We need to start teaching our kids about personal finance from a young age, help students in high school and universities to make rational financial decisions (who said credit card?), and help workers and entrepreneurs allocate a slice of their regular income so that they not only pay todays bills, but also prepare for tomorrow’s ones.

There are two things giving me hope:

1. More and more people awakening to these facts - taking actions and planning ahead. Good examples are JD, Trent, and all their followings
2. There definitely is a strong increasing market need for my expertise

As I tend to quote and link to The Economist on a regular basis, I decided to create a specific serie where I would “limit” myself to one article per week. The one I preferred of course. That way you will enjoy a quick extract of my Economist reading and will know when to expect it - I read the Economist during my week-end.

This week article is about Buying stories. I highly recommend it for its clear definition of the differences between two schools of investment principles: value investing and Growth investing.

It also ends on a few very interesting paragraphs demonstrating the value of a good Story Telling .

Plenty of studies find that people are seduced by stories: all shopping will take place over the internet, the world is running out of oil, and so on. They also like to associate with winners. It sounds better to own shares in, say, Google, than in some struggling housebuilder at the moment. So we end up overpaying for success.