Shiyan Koh, Managing Partner of Hustle Fund, and Jeremy Au discussed:
1. Singapore Vetoes Allianz $4.4B Insurer Acquisition: They discussed the Singapore government’s veto of the NTUC Income and Allianz merger, primarily over concerns of an undisclosed plan for $2B capital withdrawal post-merger. This case illustrated the delicate balance required between pursuing financial strategies and adhering to a social mission, especially in a cooperative structure transitioning to a corporatized entity.
2. NTUC 1961 History & Income Cooperative Mandate: They expanded on the broader historical role of National Trade Unions Congress with the People’s Action Party since 1961, vs. the now-defunct leftist Singapore Association of Trade Unions (SATU). The central workers' union is the parent organization of NTUC Enterprise, which is a holding entity of multiple cooperatives and mission-based corporations like NTUC Fairprice (supermarkets), First Campus (childcare) and Income (insurance). They referenced analysis on other successful single-country insurer cooperatives benchmarks from former NTUC Enterprise & NTUC Income CEO Tan Suee Chieh.
3. Trump vs. Kamala Impact on Southeast Asia: Jeremy and Shiyan debated how the US election’s potential outcomes could lead to dramatically different White House policies on free trade, capital gains and China relations - leading to significant ripple effects on Singapore & Southeast Asia. This highlights the deep interconnectivity of American political decisions with regional economic outcomes.
Jeremy and Shiyan also touched on the impact of US interest rate cuts on global markets, the acceleration of Chinese companies entering Southeast Asia, and Singapore's higher number of work hours vs. America and the EU.
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(00:57) Jeremy Au:
Morning, Shiyan.
(00:58) Shiyan Koh:
Morning Jeremy, how's it going?
(01:00) Jeremy Au:
What's up with you, Shiyan?
(01:01) Shiyan Koh:
Not much. It's been a busy couple weeks. There's been a ton of events and I was just at the Xoogler Demo Day earlier this week, where I met a couple listeners. shout out, to Melvin. We took a selfie, so that was a new experience for me. Thanks, Melvin, for making me feel like at least a D list celebrity or something. and to our listener, Jeremie, who told me that our comments about the diabetic horse really made his day. I think we could do a longer thing on GLP ones, but really it all started with the poor diabetic horse who wasn't allowed to eat carrots or apples so, yeah, but no, I think, some really good activity, the ecosystem. So the Xooglers are like Google alumni who come together around the world. They did a demo day with nine different companies presenting. Last was actually Ceasar Sengupta's new startup Arta Finance, which just did their global launch last week. That was just really cool to see. I love demo culture. I think it's more fun to see demos than to go through yet another pitch deck and so really would love to see more of those because then you can see, Hey, what's, what are you actually selling? what's, what's behind the curtain, not another slide. and then I also participated in a panel with Sega, which is bringing, Chinese entrepreneurs to Singapore to set up global companies. that was a very different segment of entrepreneur than I normally interact with despite going to Huaqiang, my Chinese is very lousy.
These are all entrepreneurs who have operated at scale in the Chinese market who are now looking to do their next thing, and are thinking about markets outside of China. It was interesting to chat with them and see what kind of technologies they were playing with, and what they were excited about.
Coming up, we've got Switch, we've got Singapore Fintech Festival. A ton more people coming into town. I think there's the mood around financing, but the underlying grassroots activity continues to be pretty strong.
(02:39) Jeremy Au:
Yeah. Awesome to hear that you've been enjoying, some of the D list celebrity fame. I also like to give a shout out to Bernard Cole from Hong Kong who reached out with a kind, testimonial about how he enjoys the podcast. We'll try our best to continue talking about Singapore and the Southeast Asia tech ecosystem in a thoughtful way. And you heard it here first from Shiyan. Your next startup idea is a GLP one for horses. we're talking about the tech ecosystem in Southeast Asia. It was a lot of events as well the past month.
I think we were wrapping up the F1, post, the super returns, obviously. And there's a lot of activity. So, family offices. I thought it was interesting because I felt like the mix of people I met was a little bit different. I think that now, there was many more family offices in a conversation, and I think they have completed their move to Singapore and now they're exploring various assets. I thought that was an interesting shift, whereas last year, at least for myself, when I met them, they felt much more like earlier in the process of exploring, the asset classes are getting set up.
(03:33) Shiyan Koh:
And I think, for the ones who are former founders as well, they've also seemed to be really interested in being a bigger part of the ecosystem, not just being financial investors, but starting to think about how they can contribute. And help build up the community, which is really heartening to see.
(03:47) Jeremy Au:
Yeah. I think the big thing we want to talk about was the NTUC Income and NTUC enterprise and Allianz insurance deal. Quite interesting the big news is that the Singapore government has decided to veto the current transaction assistance. The key reason they had was that, previously there had been $2B of surplus that had been made during NTUC Income's cooperative, social mission days. That quantum had been given a waiver, as part of the corporatization exercise and, they do not believe the social mission and the usage of those funds moving forward is well justified in light of a disclosed fact that Allianz and NTUC Income plan to withdraw $2 billion of cash after the transaction in on three years. So, that's kind of like a high level point of view, maybe you want to talk about what you think or how you would explain this in a simple way for folks.
(04:36) Shiyan Koh:
I think the order of events as we understand it is, in T0, you had NTUC Income, the cooperative. It was then privatized. As part of the privatization, the 2 billion of cash that was previously held through the cooperative, instead of being distributed back to the cooperative members, was held as part of the privatization under the justification that, they would need that capital to operate.
Then along came Allianz. The argument for the transaction, the industrial logic, was that, little old NTUC needed a bigger capital partner to compete with the big boys and that's why this transaction makes sense. The actual business plan for the post transaction business was to dividend out that cash, and in fact, close down lines of business that would have been capital consumptive. The charitable interpretation could be that along the way facts had changed, the market had shifted and different strategies had to be pursued, a less charitable interpretation might be that, This 2 billion dividend was conveniently not disclosed early because the optics don't look great. is that fair or would you want to add anything to that, Jeremy?
(05:43) Jeremy Au:
Yeah, I think it's a hundred percent fair and the crux of it is that this was very contentious. This is a good exercise for us to discuss because it reveals a lot about what we have previously discussed in past episodes. Singapore has a lot of cooperatives in our economy.
the nature of a social enterprise, a corporation versus a cooperative, obviously kind of like the role of civic society and business world. But let's maybe talk about the transaction itself, before we go into those. The end outcome of this was that, we thought that Allianz was paying about 2. 2 percent stake of the company, which roughly valued NTUC Income at about, $4. 4 billion, roughly. If they extracted 2 billion of prior surplus, this does two things, right?
One is that first of all, NTUC Enterprise, which, was a previous, kind of like full owner of NTUC Income, now gets $3. 2 billion, right? and then, Allianz were paid. net amount of $1.2 billion, for, I guess smaller NTUC income of, with a smaller capital base. The net effect is that NTUC income as an insurer is a smaller business moving forward. You can call it, pluses or minus, right? So that's a minus there. The transaction price is therefore better for NTUC enterprise, because they get more wealth and Allianz also gets a slightly better transaction, which is net neutral, I think the best party out of that transaction would be, NTUC Enterprise.
(07:05) Shiyan Koh:
Yeah. So you can make the argument that they were performing their fiduciary duty by maximizing the outcome for shareholders. The question is was that the intended outcome of the privatization to begin with? and were the promises about honoring the cooperatives mission regardless of the privatization kept? Despite all the money flowing in and out, does the end creature that emerges still do the same job, as well as it would have before all of these transactions?
I'm not sure I know the answer to that.
(07:32) Jeremy Au:
Well, I think it goes back to the debate for cooperatives, because NTUC Enterprise itself is a cooperative. So technically, getting a better transaction price, from Allianz is a transfer of wealth from one cooperative, NTUC Income, into another cooperative, NTUC Enterprise as a whole.
So you would say like left hand, right hand from a cooperative structure. One group that also benefits is NTUC Income, the insurer minority shareholders, right? As part of the corporatization exercise, had bought shares in NTUC Income.
So I think those are the dynamics that's a little bit there. And it's interesting to figure out.
(08:05) Shiyan Koh:
Yeah. I think that goes back to the original goal of the privatization, right? Did we achieve that? And does this new format with Allianz do a better job of that than not?
(08:15) Jeremy Au:
Yeah, I think it was interesting to see a lot of former NTUC Income CEOs come out against the deal. So obviously we had Tan Suee Chieh, who was the former CEO for NTUC Income. And also the CEO for NTUC Enterprise came out against the deal. He came up with a very long and substantive list of objections, from his perspective. And I think what was interesting from his argument was that, at the end of the day, insurers can succeed over the long term, he uses a lot of examples from Europe, and says these insurance functions are actually best performed by a cooperative, effectively a social enterprise for the benefit of its members, as well as for society.
I thought it was a really interesting argument, because, I haven't thought about mutualization versus demutualization, which is basically saying what does it take to become a cooperative versus what does it take to unregister as a cooperative and become a corporation, which, scratches the, you social enterprise, entrepreneur side of me, which is a very interesting debate because Singapore actually has a long history of cooperatives ever since the 1960s.
(09:09) Shiyan Koh:
Do you want to go through what is a cooperative and why they make sense or in what circumstances they make sense?
(09:15) Jeremy Au:
Yeah, I think cooperatives are helpful because obviously they're there not to benefit shareholders, which, one vote equals to $1. This is part of the overall side, obviously. And then generally as a result, the goal for corporations is that you're supposed to increase profit for its shareholders versus cooperatives are defined by normally as a social mission, but it's constituencies based on members, right?
So, there's no real shareholder as a cooperative, so it's supposed to be benefiting the members. So it's an interesting dynamic, where at the end of the day, what you normally see a cooperative do, and NTUC Enterprise is quite famous for running supermarket chains in Singapore called NTUC, fun fact, NTUC means National Trades Union Congress, which is, again, goes back to his cooperative and worker, constituency, representation roots. And I think what it means for the context of insurance, by calling back to our original mission, you previously mentioned in a previous episode that insurance is a way to lower catastrophic risk, right?
Motor insurance, catastrophic illness insurance is basically like if one person gets really sick and 99 people don't get sick, insurance is supposed to spread out the pain of that. The good thing about having a nonprofit run this process is that, you would work hard to extend policies to everybody and get a widest possible group. A corporation or a stronger profit motive may have an incentive to have a smaller, higher quality policyholder pool, excluding some of these higher risk populations.
I think it's an interesting debate that we have.
(10:41) Shiyan Koh:
Yeah, and I think in the early days a big part of it was that, they were willing to do small dollar policies. It wasn't just about underwriting high risk people. It was about underwriting people who weren't particularly at the individual level, super profitable to serve, but if you got people into the habit of insuring themselves and got enough of them, over time, you could build up a pool of people and you didn't have to deal with your shareholder in terms of a profit, right? You could just be like, am I offering catastrophic risk insurance? Am I solvent to do that? and I think the argument is that, now in the modern era, all these consumers have ample, alternatives, so you don't need as much of that option.
Obviously Singapore has gotten richer. The deregulation of some of these industries. you have multiple insurance options. It's not like no one will insure you. And I think on a prior episode, part of the argument that I was making was like, there is still a role for cooperatives because they keep a lower price bound, right? Because they don't have a prop maximization incentive. so I think, what is it? Charlie Munger, right? Show me incentives and I'll tell you how someone's going to behave. We believe that deeply. Say, you want to achieve cooperative goals, if you have a profit incentive, you're still always going to tend towards that.
(11:47) Jeremy Au:
I think the quote that came up quite a lot was that the Allianz CEO, Oliver Bäte, said he was worried about things that look great from a volume perspective and not so great from a value perspective. That was, I think, the quote that caused a lot of alarm bells, I would say, along the quotes from a lot of the former NTUC Income CEOs. it goes back to what you just said, which is that, what that's kind of like business corporate language for is basically saying that the post acquisition plans was to shrink the volume of policies over time to create more value from the overall pool, which makes sense, from a for profit insurer looking to expand into Southeast Asia and use Singapore as a headquarters, it makes a lot of sense from a corporate perspective and a shareholder, but obviously from a cooperative perspective where you've all these policy holders. then you, you, all these questions come up, come up.
So I think there's both the go forward. Does this fulfill the requirements? But also, there's a strong emotional or philosophical promises kept, promises made kind of dynamic. I think that's a lot of people are kind of like, really getting themselves into.
(12:42) Shiyan Koh:
Yeah, I agree. I think it's useful to do some good explanation here, because of the historical role that NTUC has played in Singapore society. I think a lot of people feel attached to it, right? If you had to play this out in some other random segment, you're like, hey, this is a cooperative of underwater basket weavers, and we've privatized it, and now some foreign underwater basket weaving entity has come to buy a majority stake. I think people would probably care less because fewer people would have been affected or touched by it.
When it does have a broad ranging impact that way, I think it just, it does merit spending a little bit of time kind of talking through and understanding the logic of what happened. I think Most people are busy, right? They just read the headlines and either you're like, oh yeah, I like that law, or, they don't engage with the details of it. And so I do think it is useful to have that conversation.
(13:32) Jeremy Au: Yeah, exactly. The history is important, right? NTUC is a tripartite member that represents employees and was closely affiliated with the People's Action Party during the independence days, In fact, NTUC split from an early entity called the Singapore Trades Union Congress. So Singapore Trades Union Congress, SUC split the two, NTUC went with the today's People's Action Party in 1961. And, further left wing unionists went for the Singapore Association of Trade Unions, SATU. So NTUC continues to be PAP affiliated. so yeah, and they also now runs NTUC enterprise, which is a whole core for all these social enterprises, right?
So we said supermarkets, childcare, the Hawker Centers. So actually it's a very big chunk of the Singapore economy. If you go one level deeper, your NTUC income, about 2 million Singaporeans have, NTUC income policy. So that's pretty much everybody, every household. Obviously this is going to be a big emotional issue if you say 2 million Singaporeans have something, that means only the kids don't have it. And maybe your grandparents who don't remember they have a policy, but that's pretty much everybody, right? You have 2 million Singaporeans.
(14:35) Shiyan Koh:
We should do the math of if the transaction had gone through, what would be the net payout per NTUC enterprise shareholder? Relative to, I don't know what potential increase in premiums an NTUC income policyholder would face. And there's some sort of calculation, but I guess, I mean, after the privatization, you don't get any benefit, only the shareholders benefit. So it doesn't really matter to you. Like you as an income policyholder only experience price increases, potential price increases.
(15:02) Jeremy Au:
I think that NTUC income minority shareholders who bought shares as part of the corporatization exercise, will benefit And then this cash withdrawal obviously benefits NTUC enterprise members in the sense that it can use that capital to deploy that in other.
Social purposes and missions, right? So, I think if you look at this a positive spirit, I think you should say like, hey, we're making a decision that insurance is not the way we have fulfilled our function as a market price moderator. And, we no longer need to run this exercise.
So, it's, if you look at it, if you see NTC income move from cooperative to corporatization. for this proposed acquisition, it feels like the direction of travel feels like, Hey, we think that there's less of that now. Clearly, at the current transaction, it probably doesn't make sense, based also on a current pushback by the public, but I think the direction of travel feels relatively clear to me actually.
(15:55) Shiyan Koh:
So you think they'll come back with a revised proposal?
(15:57) Jeremy Au:
I think there could be a revised proposal. It could potentially be accepted. I think the precedent ways for that to be resolved, for example, the 2 billion of cash withdrawal could go back to the cooperatives, which is what the government had signed the initial exemption for.
So I think that could be one way. And then the transaction price and everything would be reevaluated. the. standalone enterprise value and other things will sort itself out from there. The other way of course is that, perhaps, NTUC Income continues to be a entity under NTUC Enterprise, but it may continue to do that trimming of his product lines and kind of like restructure his capital. And then still eventually return the capital to cooperatives, I think the crux of it is, what do you do with the 2 billion of surplus or extra earnings made during his cooperative days before this corporatization exercise?
that's the big sticking point for government. there are many ways to resolve that, which is effectively give it back to the government or let it continue to stay within NTUC income. The clear pushback from my perspective is nobody wants to see that withdrawn half of it can go to NTUC enterprise for social mission purposes, but a billion of that goes to Allianz shareholder. I think it's probably failed the sniff test from the government's perspective.
(17:01) Shiyan Koh:
Who says every day is a slow news day in Singapore? So many good pieces of news.
(17:06) Jeremy Au:
Yeah, there's lots to unpack in this, and a lot of history as well. I feel like I understand all the parties in this transaction, how everybody thought it made sense, and how it helped achieve their shareholder mission, their cooperative mission, their mission to help Singapore.
I think it all kind of makes sense. But then you look at it all together and you're like, okay, I can see why it's getting a lot of pushback.
(17:26) Shiyan Koh:
you know, what doesn't make sense. It's 25 days until the US election. And it's still a toss up. That does not make any sense to me.
(17:34) Jeremy Au:
I'm not surprised it's a toss up, but are you surprised it's a toss up?
(17:37) Shiyan Koh:
I feel like there's just so much crazy coming out of the Trump fans campaign that it boggles my mind. He got up at a rally and played music for half an hour, didn't answer any questions. I was like, what?
(17:49) Jeremy Au:
I don't know. I also want to dance for half an hour. Why not? just chill. I'm not surprised that there's such a toss up.
(17:55) Shiyan Koh:
Maybe it's a vibes election. Who cares what anybody says? We'll just play music. That's like totally crazy to me. That, a world superpower could decide its leader in such a manner. It boggles the mind.
(18:06) Jeremy Au:
First of all, it's political polarization, which is a function of game theory, right? It's like, you have election, it's winner takes all with a lot of executive power. and then, the system is slightly geared towards electoral college. so yeah, everybody maximizes and then, some systems benefit when you're 50, 50 percent deadlock, where you have 5 percent swinging, versus like, more young democracies where they're massive swings or massive 30 or 40 point swings. I feel like this is the end state for a mature democracy.
(18:34) Shiyan Koh:
I think they need to refactor it.
(18:35) Jeremy Au:
What? Is that your t shirt now? Refactor Democracy?
(18:38) Shiyan Koh:
I can agree with you that given the set of incentives that people have and where they are, this is a logical place for things to end up, but no one likes it. It isn't like anyone thinks this is a great state of affairs. that's why I think, maybe I'll make a t shirt.
Refactor the code base. Down with Electoral College,. Down with Citizens United.
(18:57) Jeremy Au:
Look, at the end of the day, I always like to joke that democracy is a young institution. It's something that existed since the 20th century. So I think people are still figuring out a lot of the mechanics and outcomes of what a democracy looks like. So I think a lot of us are middle aged democracies today and Singapore is a young democracy.
(19:13) Shiyan Koh:
I think democracy is too broad a statement, right? Because there's many ways of, administering that. I think it's a really hard problem. Sorry, that's so unhelpful. I'm sorry, Americans. It's your country. You guys figure it out.
(19:24) Jeremy Au:
What people are interested in is the impact on Southeast Asia based on the stated policy and platforms,
(19:29) Shiyan Koh:
I don't think it makes a difference. I think one thing that is like, what difference do you think it makes, a Republican or a Democrat administration as it pertains to Southeast Asia?
(19:36) Jeremy Au:
Kamala Harris has proposed a continuation of the Biden policies. So we should continue being strict on China. I would say that I think Trump does have, as is claimed, obviously with a 60 percent tariff on Chinese imports and a global import tariff as well, which would apply to like Singapore, Vietnamese, exports to America as well to kind of like reduce the, from his perspective, the trade imbalance as well.
So I think obviously, whether you, have conviction that this is policy platform executed afterwards is the question of cost. that's a question for everybody's mind, but I think that would be a significant change to the free trade environment globally.
(20:12) Shiyan Koh:
Yeah, who knows what Trump will do, right? Because he's a wild card. But in terms of the specific China related policies, it seems clear that both potential administrations would carry on with the tariff regime. that's kind of status quo for where we are right now.
the imposition of a global tariff regime seems a little bit of a further stretch.
(20:30) Jeremy Au:
If trump wins and he executes the policy as he says he will. Then obviously Chinese exports to America would drop. I think you're going to see further Chinese movement of manufacturing into Southeast Asia, because if they move their factory into Vietnam and sell to America, there's a 50 percent tariff reduction You can imagine, the Trump administration doing a bit of don't know what you call it, whac a mole, right? But try and make sure that, hey, the 10 percent tariff for global imports applies to Vietnamese companies rather than Chinese companies. For example, that could be another dynamic. And then thirdly, of course, you will see that Chinese exporters will focus a lot more on exporting to Southeast Asia, as an end market. we already saw pushback, where Indonesia recently banned Termu, which is a subsidiary of Pinduoduo, from selling, because they're worried about Indonesia's shrinking middle class and shrinking local manufacturing base as well.
(21:21) Shiyan Koh:
Yeah, but that's already happening. And it's not just Southeast Asia as an end export market, China is looking for export markets wherever it can. most of the PV panels in the world are Chinese. so, yeah, I don't know. I don't think it's that big a difference.
Yeah, think they're, they're united in their tariff regime.
(21:35) Jeremy Au:
I think it's happening. I'm just saying that the acceleration of that will happen a lot more under Trump administration. I think a lot more countries around the world that would have taken a more gradual approach to intervening will probably have to take a sharper protectionist measure, right? a lot of Southeast Asian economies were inspired by the Trump and Biden administration policies and tariffs, right? And protectionism and said, Hey, if America is doing this, we should do this as well. Historically America was a proponent of free trade, I mean, you led all the free trade agreements for a long, long time. So, I am just saying if, there's an escalation of tariffs. I can imagine that exports accelerate from China to Southeast Asia, competition and internal political pressure ramps up. Southeast Asia actually annexed more protectionist measures as well. So I think there's an acceleration of these trends.
(22:17) Shiyan Koh:
We'll see.
(22:18) Jeremy Au:
Yeah.
(22:18) Shiyan Koh:
I've blocked the morning, of the sixth, to review that to watch the election results.
(22:22) Jeremy Au:
We'll see how it goes. was it like, what's the prayer there that you have courage to change the things I can change, serenity to accept the things I cannot change and wisdom to know the difference. so, I think my perspective on that is, the US election will happen the way it happens, right? I mean, it's not in my control. It's the weather that will happen and we will have to do a lot of business planning the day after the election.
(22:43) Shiyan Koh:
Such is the plight of small nations.
(22:45) Jeremy Au:
On that, cheerful note.
(22:47) Shiyan Koh:
There's a lot of small countries in the world. So small countries as defined as places with populations under 10 million. I think over half of the UN countries are countries of less than 10 million. So us small countries have to stick together.
(22:59) Jeremy Au:
Yeah. I mean, technically, that's what the General Assembly is for, right? It's a democracy or like, one country, one vote, rather than, in the real world, where the strong do what they want and the weak do what they must, right?
(23:09) Shiyan Koh:
That's a different conversation.
(23:11) Jeremy Au:
I guess if you lookorward to the next month, Shiyan, and what's the one thing you're excited for?
(23:14) Shiyan Koh:
I'm going to my 20 year college reunion next week, so I'm excited about that.
(23:19) Jeremy Au:
That's going to be in California?
(23:21) Shiyan Koh:
My mom's like, where are you going? I said, I'm going to my 20 year college reunion. And she's like, wow. 20 years, a blink of an eye. And I was like, for you or for me? And she's like, both.
I think that's going to be pretty fun, something to look forward to before the election results, I suppose. I think we mentioned at the top of the episode, Switch, FinTech festival are coming up and we've got a ton of events around that.
So, I think it's really good, right? You see all the underlying activity metrics being good in the ecosystem. And there's a lot of excitement. people are building stuff, people are shipping. I love that. How about you? What are you looking forward to?
(23:52) Jeremy Au:
Well, I am looking forward to getting work done. Thanksgiving in November is a big end date for American, economic activity. my job is to get everything done before that date as much as possible with every single person. obviously, you know, in Singapore, we work a lot more man hours, than the U S and , I'm going to do a future episode doing some financial analysis on that, research. I'm just excited to get everything done, Do I sound like a workaholic?
(24:16) Shiyan Koh:
You know what we should discuss this in another topic, because I know people always say that stat about how Singaporeans work more than everybody else. And I just don't really believe it. Maybe that's controversial. Definitely more than the Europeans. But at least, I feel like in the valley people work pretty hard.
Yeah. as a comp to like Southeast Asia startup life, I don't know that, we've worked way more. You're holding your tongue. What do you want to say? Just let it out, Jeremy.
(24:40) Jeremy Au:
Frankly, last night for fun, I was doing that analysis and the quick sketch of it. The analysis I'm doing was, my wife deflected me that Singapore has more working hours than the U. S. and you, and that is true. So the analysis I did was that Singapore works about 3, 800 man hours a year, whereas America works 2, 300 hours a year and the EU works 1, 800 hours per year. So that's a reported government number. So that's the facts. And then after that I started saying like, wait, that's not fair because Singapore's GDP per capita a purchasing power parity, like adjusted for cost of living is high, actually higher than America. So are we earning more? As a formally trained economics student, we also have to adjust for the fact that Singapore has a very strong MNC headquarter base in Southeast Asia, so it's not that GDP is credited to us, but it doesn't flow to individuals.
So then you start looking at domestic household consumption, which is, how much you get to spend Americans get to spend a lot of money, but Singaporeans don't really spend that much But then you adjust it again for cost of living. the Singapore household size is larger than that of Americans, which an American's household size is larger than EU.
So you adjust for that. And then you have to adjust for working adults in the household. it becomes this crazy Excel process, which I will eventually package nicely. But basically what I'm trying to say here is, the key takeaway is that Singaporeans do earn a lot of money, but they earn a lot of money because they work a lot of hours and they're not as, productive or they don't earn as much per hour as an American, right?
So that seems to be my initial analysis. I thought it was an interesting comparison. I was using that to do this analysis and eventually I want to broaden it out to our comparables, right? Switzerland, Hong Kong, Israel, London, New York, SF, but obviously there's a whole exercise altogether.
(26:22) Shiyan Koh:
Wow. I didn't realize I had set this off. Okay, you bring the data to the party. I'll just make armchair observations, based off of anecdotes.
(26:31) Jeremy Au:
I really enjoy my time in Italy. Just kidding.
(26:33) Shiyan Koh:
You make a really fair point. I feel totally called out on topic. I it is fair, right? Which is let's look at the data and see what it is. but yeah, I agree with you. Let's look at the data.
Peace out and we'll see you next time.
Sounds good.