Quora Answer: Will China Have the Military Capability to Successfully Invade Taiwan by 2029?

The following is my answer to a Quora question: “Will China have the military capability to successfully invade and hold Taiwan by 2029?”

No.  China has the ability to attack Taiwan, to blockade Taiwan, and to deny it airspace and littoral waters even now.  But it does not have the ability to invade Taiwan, even by 2029.  The first barrier is control of the sea and air.  Whilst China can deny Taiwan control of them, it cannot achieve superiority, which is the prerequisite of a successful invasion.

First, China has to contend with the US Navy, specifically the Pacific Fleet, and the Indian Ocean Fleet, the 7^th and 5^th.  This is why China is working to develop sufficient shore-based and ship-based ASW capability, including hypersonic missiles to keep the carrier fleets at their extreme operation range, limiting their effectiveness to interdict Chinese forces marshalling across the Taiwan Straits.

China does not have an effective 5^th generation fighter in sufficient numbers to sweep the USN and USAF from the skies.  They will lose too many aircraft to fulfill the ground support role required in securing a beach head.  The political calculation would be to make American and possibly allied casualties so high as to make opposing China politically prohibitive.  This is assuming that no one avails themselves to a nuclear conflict.

Invading Taiwan requires securing the South China Sea all the way to Macclesfield Bank.  It also requires blockading the waters of the East China Sea up to Korea, where the US has a large land contingent.  China does not have enough surface ships to do that.  Shore batteries can only reach so far.  They do not have enough aircraft to secure the airspace of such a wide theatre of conflict.

In the past, they could always have used North Korea as a proxy to take pressure off by creating a secondary front.  As of now, the disparity between the ROK and DPRK forces is so wide, that aside from the initial artillery bombardment, North Korea would collapse before significant ROK forces seized Pyongyang.  Kim Jong-Un is not an idiot.  The South Koreans are also quite aware of this, but they do not want the expense of unification, and a humanitarian crisis at the border.  The facade of deterrent is cheaper.

Assuming all this is miraculously addressed, China does not have the sea and airlift capability to move the 200,000 or so troops needed for the meat grinder of an initial beach assault.  They could conceivably have enough landing ships by 2029, but not the naval support to prevent them being sitting ducks crossing the Straits.  China is building aircraft carriers to project force, pushing US carriers further away from the theatre.  It would take another 30 years to commission a deterrent carrier fleet.  They are currently experimenting with different take-off and recovery systems.  Their designated fighter is still too heavy for effective carrier operations.

In summary, China has major logistics and doctrinal issues to address before they think of a Taiwan invasion.  By the time they fix all that, Taiwan would have likely become another SAR on their own terms.

Quora Answer: How Does the Beneficiary Receive Money from a Blind Trust?

The following is my answer to a Quora question: “How does the beneficiary receive money from a blind trust?”

The beneficiary of a blind trust receives the funds in the same manner as any other trust.  It may be a bank transfer at regular intervals, for example.  The only difference here is that the beneficiaries of a blind trust, even if they were the settlor, have no say in the running of the trust.  They do not even know the assets and size of the trust.

Quora Answer: What Ability Might the Trump Organization Have to Prevent Its Insurance Broker from Complying with New York Prosecutors?

The following is my answer to a Quora question: “What ability might the Trump Organization have, if any, to prevent its insurance broker from complying with the New York prosecutors’ demanding records?”

Trump Organization, for all the political clout of the owners, is still only a company registered in a state.  It can obfuscate, it can delay, it can throw up legal barriers.  In the end, it either complies or faces severe legal actions that include dissolution and seizure of assets.   The company may attempt to shift operations out of New York, but they cannot move the buildings, the golf course, the malls they own.  These are all subject to seizure, in the most extreme cases.  The broker is an external company. They are not going to take the risk of losing their licence, and their owners and brokers are not going to risk jail. In the end, although it may take time, someone will talk.

Quora Answer: Besides the Way They are Funded, How Do Startups & Small Businesses Differ?

The following is my answer to a Quora question: “Besides the way they are funded, how do startups and small businesses differ?”

The primary intent of a start-up is the exit.  It is about building a foundation that can be scaled up, to bring in more funds to generate more revenue.  A start-up, as the name suggests, is the beginning of building a vehicle to carry out a specific business.  At the end of it, the founders have either sold their stake and moved on, or they have taken the company public, which means they are no longer sole owners.

A small business does not have such ambitions.  The intent of the owner is to generate revenue, so that the business owner can take profit out.  It may or may not be a company.  A small business does not have the express intent of seeking funding to scale up the business.  Often, the nature of the business process precludes any such scaling up.

Quora Answer: What are Some Ways to Thrive during a Recession?

The following is my answer to a Quora question: “With a recession coming closer, what are some methods to thrive during a recession?”

Market crashes tend to come in 20-year cycles.  The last crash was in 2008 subprime crisis, and the one before that was Black Monday in 1987.  The Asian economic crisis of 1998 was regional.  Accordingly, we should expect a major crash around 2028.  This is not to say that there will not be major market shocks.

I expect that Brexit would lead to a contraction of the British economy.  There is also the possible contagion of a pending European debt crisis, from the over-leveraged economies in the EU South: Portugal, Spain, France, Italy and Greece.  We have to consider that China’s total borrowing on GDP, both direct and through state-owned actors, is over 300%.  They need the OBOR to export all that excess production somewhere because they cannot afford their economy to slow down.  They have millions of young people entering the market every year.  The Communist Party promised them a better life, and it has to deliver.  The US economy is unbalanced, and they are not going to bring manufacturing back anytime soon.  There is a wealth disparity between the wealthy coast and the extreme poverty of the South and Midwest.  Small town America is dying.  Their political divide is not in a position to address this.

Economies heavily reliant on commodities are suffering because they budgeted or borrowed on the assumption of higher prices, and most of them cannot sustain the deficit.  This includes countries as diverse as Saudi Arabia, Russia and Australia.  None of this is necessarily bad. These are all wonderful opportunities to make money, especially if you have the funds, and understand the market.  There is no general advice on thriving, since there are specific opportunities in specific nations.

One common method is to hedge gold and gold certificates.  Gold is the safe haven when the market crashes, and people rush to it for emotional support.  This is a self-fulfilling prophecy, and gold always rises.  Another safe haven is investment-grade sovereign bonds and corporate papers.  These are unlikely to default.  If you have the appetite and the means to leverage your funds, this is a good time to go bargain hunting.  When the market is down, central banks practice quantitative easing to put liquidity back in the market.  This is an excellent opportunity to dump non-performing assets on a desperate market and switch out your funds.

If you know what you are doing, market crashes and recessions are wonderful things.  They allow you to acquire good assets on the cheap and strangle weaker governments in developing countries.  That is precisely why it is engineered.

Quora Answer: Is Money Laundering Not the Exact Opposite of Tax Evasion?

The following is my answer to a Quora question: “Is money laundering not the exact opposite of tax evasion?”

Money laundering is the act of concealing the origins of funds acquired through illegal means by placement, layering and integration into the financial system.  Tax evasion is the act of not paying taxes illegally, or underpaying taxes through false declaration of asset worth or hiding ownership.  Whilst they are not the same thing, there is a relationship.  When assets and funds are undeclared so as to avoid taxes, the owner of these assets and funds still need to be able to enjoy them.  That means justifying their existence.  This is where money laundering comes into the picture.

Quora Answer: How Long Did it Take Warren Edward Buffett to Become a Millionaire?

The following is my answer to a Quora question: “How long did it take for Warren Edward Buffett to become a millionaire?”

There is a documentary about it, in addition to several books. Warren Edward Buffet is said to have made his first million by age 30.  However, we must remember that Warren did not start out broke.  His father was Howard Homan Buffett, a four-term Republican who represented Nebraska, an investor, and a wealthy man in his own right.

This is not to discount Warren.  He took the cards he was dealt with and did well with it.  We respect that. But we must remember that he had some inherent advantages that others may not have.  We have to understand that wealth is also a matter of circumstance, in addition to our own qualities.  There are lessons to learn in how he became so wealthy, but how fast he did it is not one of them.

Quora Answer: Will an Independent Johor Benefit Singapore?

The following is my answer to a Quora question: “Will an independent Johor benefit Singapore?”

An independent Johor would likely be friendlier to Singapore than Malaysia is for economic reasons.  Singapore is one of the largest investors in Johor, Singapore has put in more money into Johor since independence than the Malaysian federal government has.

Johor competes with Selangor in being the most industrialised state in Malaysia.  It competes with Sarawak as the wealthiest state.  The federal government system effectively means that revenue from Johor subsidises other states such as Pahang, Kelantan and Kedah.  An independent Johor no longer has to subsidise less developed regions of Malaysia, and would potentially grow faster.  This economic growth benefits Singapore because the value of our investments in Johor grows.  This accelerated economic growth also benefits us because it means that Johor grows as a market for our goods and services.  Johor and Singapore have a natural synergy because of how their respective economies are structured.  Johor is the effective manufacturing and agriculture sector, while Singapore is the logistics, banking and finance hub.

Economics aside, Johor functions as an effective buffer state between Singapore and the rump Malaysia.  This increases our security since it creates strategic depth without the need for Singapore to consider occupying southern Malaysia in the event of a military conflict.

Quora Answer: If, as a 17-Year-Old, I Received US$30 Million, How Can I Live Off That for the Rest of My Life?

The following is my answer to a Quora question: “If I am 17-years-old, and just received $30 million dollars, how can I live off that for the rest of my life?  $300,000 a year for 30 years?”

The answer will only address generalities.  Firstly, put the funds in an entity that is distinct from you, either a trust or a company.  This mitigates your tax liability, and allows you to expense out a lot of things.  Secondly, get an investment banker, an accountant and a financial advisor involved.  Managing funds is a full-time business, and you should spend time getting the best you can afford.  Thirdly, cultivate the habit of living within your means.  Nobody needs 20 mansions and half a dozen vehicles.  People forget how easy it is lo lose track of spending and wasting a lot of money.

When it comes to your asset management, diversify them to mitigate risk, so that a downturn in one sector of the economy does not affect your net worth severely.  At even $10 million set aside, getting a reasonable 6.5% or so return per annum is around $650,000.  With proper management, it is quite possible to turn that $30 million into $100 million in five years or so.

Quora Answer: Is Learning How to Invest Worth the Effort & Risk?

The following is my answer to a Quora question: “Is learning how to invest worth the effort and risks?”

If you have an interest in managing your own wealth, or understanding how professionals do so, then it is worth the effort to learn how to invest.  There is no risk involved since you are learning a skill.  The risk comes when you actually attempt to manage your assets.  The difference here is that the risk is calculated; it is no longer a lottery.  The positive here is that since you are actively managing, you have some control over that risk.  There is no reward without risk.  Embrace that risk, and invest with reasonable goals.  You will find that you gain more than you lose.

Quora Answer: Do Singaporeans Lack Critical Thinking?

The following is my answer to a Quora question: “Do Singaporeans lack critical thinking?”

I would not say that Singaporeans lack critical thinking; I would say that critical thinking is not a skill that is nurtured and emphasised in our education system.  This does not mean that what we have is inadequate.  It is the same all over the world, except at the highest institutions of learning, or through the experience of struggling to the top.

The purpose of an education system is not to encourage thinking.  It is to educate; in that it is meant to equip the next generation with the necessary skills to drive the machinery of economy.  We need executors of policy, not thinkers.  A political system with too many thinkers would eventually be overturned.  No government plans for its replacement.

The question, then, should be, if Singaporeans have the capacity for critical thinking.  The answer is obviously yes, since Singaporeans are well educated.  You cannot be a critical thinker without knowledge.

Quora Answer: Which Would You Choose - A Living Will or a Living Trust?

The following is my answer to a Quora question: “Which would you choose: a living will or a living trust?”

They are neither the same type of legal instruction, nor are they mutually exclusive.  A living will addresses the management of your assets, and your healthcare costs in the event of your mental impairment or absolute physical incapacity.  Since you are unable to manage your own assets, or see to your needs, you empower someone to do so according to the terms of the living will.

A living trust is a means to bypass the probate process in the management of your estate upon your demise. As a distinct legal entity from you, it has the advantage of protecting your estate from legal claims against your person, mitigate your tax liability, and grant you a greater measure of confidentiality since assets are not public.

Quora Answer: What are the Possible Consequences if a Legal Guardian Does Not Disclose Assets to the Executor of the Will?

The following is my answer to a Quora question: “What are the possible consequences of legal guardian not disclosing assets to the executor of a last will and testament?”

Hiding assets that do not belong to you, with the intention to appropriate it, or deny it to the rightful heir is a major offence.  Depending on the nature of this non-disclosure, and the type of neglect of the fiduciary responsibility, it may be fraud, theft, criminal misappropriation of property and more.  Depending on how these assets were disposed of, we can add money laundering and other charges.  On top of that, there is the accompanying civil action to recover the assets, which lead to asset seizure and significant financial penalties. In summary, you go to jail, and you go there broke.

Quora Answer: What Would Happen if Malaysia Invades Singapore?

The following is my answer to a Quora question: “What would happen if Malaysia invades Singapore?”

The presumption here is that Malaysia can invade Singapore, which is unrealistic.  Conventional wisdom is that an aggressor requires at least three times the size of the defending force.  Singapore’s active military is four times Malaysia’s.  Singapore’s defence spending is more than twice, with per capita spending that dwarfs Malaysia.  And all this, before we consider the vast technological disparity.

Malaysia has trouble securing its borders from militants from Mindanao.  It has no credible early detection, no credible standoff capability, no credible sea lift, and has not even managed to maintain what they have due to endemic corruption.  What are they going to do?  March across the Causeway, and we are going to bend over for them?

Malaysian politicians are full of bluster, but even Mahathir bin Mohamed is on record that Malaysia cannot win a war against Singapore.  Their Defence Minister, Mohamad bin Sabu, has announced to the world that the MAF has aircraft that cannot fly, a submarine that cannot submerge, and soldiers who have not been training.  The closest Malaysia would come to an invasion is if their ethnic and religious tensions lead to the country imploding and us having thousands of refugees at the border.

Quora Answer: Why Do Many People Not Consider Life Insurance Important?

The following is my answer to a Quora question: “Why do many people not consider life insurance to be important?”

I believe that there are very few people who consider life insurance unimportant.  In most cases, it is an issue of at the cost benefit analysis, priorities, or simply, procrastination.  Life insurance is a very dry subject, and it is not often the easiest to understand.  In some places, and the US comes to mind, the claim process may be more convoluted, or the insurer has a credibility deficit.  These are perfectly understandable concerns.  Essentially, people must be made to understand that the more we have, the more we have to lose.  In that sense, it makes it a logical decision to consider some manner of liability protection, and loss mitigation.  That depends on the financial consultant or insurance agent having the ability to bring that across.

Quora Answer: Do I Need to be Certified in Order to be a Financial Planner if I Have a CPA?

The following is my answer to a Quora question: “Do I need to be certified in order to be a financial planner?  I am already a CPA.”

I am not sure of the legal requirements where you are, but in Singapore, there is a separate certification regime for people working in finance distinct from the CPA.  A CPA only means you understand accounting.  It does not cover asset classes, banking and insurance laws, broader fiscal and monetary policy, liability mitigation and healthcare policy.  That requires specialised certification.

In that sense, we have HI and M5 papers that cover the foundations on health insurance and insurance.  Then there is M8 and 8A, which is about managing funds, collective investment schemes of all types.  And then, there is M9 and 9A, which is for investment-linked plans.  The minimum pass mark for these papers is 80%.

There is a separate capital markets license issued to companies to manage their own funds.  There is a separate banking license regime as well.

Quora Answer: Why Does Singapore Say Malaysia Lost the Right to Review the 1962 Water Agreement?

The following is my answer to a Quora question: “Why does Singapore say Malaysia lost the right to review the 1962 Water Agreement?  The original texts say that it is subject to review after the expiry of 25 years.”

Singapore’s interpretation is that the agreement is subject to review in 25 years, not after.  Accordingly, in 1986 and 1987, Singapore approached Malaysia to review the prices.  Malaysia, then with Mahathir bin Mohamed as Prime Minister, declined because this would have also meant an increase in treated water Singapore sold to Malaysia.  Notwithstanding, it is not as if Singapore did not keep that open as a measure of goodwill.  However, Malaysia decided to complicate the issue after 1998 by adding a whole host of bilateral issues to be negotiated as a package.  The initial impetus was when Malaysia requested financial aid from Singapore due to the economic crisis.

Between that time until early 2003, Malaysia kept changing its position and increasing the price, from M$0.45 per thousand gallons to M$0.60 to M$6.25.  If we go back to just before 1990, Lee Kuan Yew himself offered a price of M$0.45, which Mahathir rejected, and counter offered M$0.60.  Contrary to how Malaysia has characterised the negotiation process, Singapore has tried to be accommodating and reasonable.  It is Malaysia that has negotiated in bad faith, and kept moving the goal posts.

Singapore embarrassed Malaysia by putting some of that correspondence in press releases in the MFA website, and Lee Kuan Yew mentioned it in his memoirs.  Essentially, the Malaysian side are idiots, who do not know exactly what they want besides more money.

Quora Answer: As a Company Director & Type I Diabetic, is There Insurance You Can Get?

The following is my answer to a Quora question: “If you are a company director and Type I diabetic, is there any insurance you can get to cover you if you get ill due to your condition?”

Getting a policy for your business is often general insurance.  It mitigates liability for legal action, force majeure, or various forms of loss.  A wide variety of coverage exists for a wide variety of risks.  None of that touches your personal health coverage as a director, and that remains the actual problem.

Personal Insurance: The Underwriting Wall

Any personal health or life policy, regardless of whether you or your company owns it, treats diabetes as a pre-existing condition.  AIA Singapore, for example, states in its own underwriting guidance that pre-existing conditions are not covered unless declared and accepted during underwriting, and every application requires full medical disclosure.

AIA Singapore does sell a dedicated diabetes product, AIA Diabetes Care, covering five diabetes-related critical illnesses, blindness, kidney failure, stroke, heart attack, and coronary artery bypass surgery, at a premium guaranteed unchanged until age 80.  Read the product description closely, and the limitation becomes obvious.  AIA built this specifically for pre-diabetics and Type 2 diabetics.  Type 1 diabetics are not the target market this product was designed to serve, and standard term and whole life underwriting elsewhere routinely declines or heavily loads Type 1 applicants outright.  Manulife Critical SelectCare is one of the few Singapore products explicitly considering Type 1 diabetic applicants, using HbA1c-friendly underwriting rather than an automatic decline.

The Integrated Shield Plan Layer

Seven insurers currently offer Integrated Shield Plans in Singapore: AIA, Great Eastern, HSBC Life, Income Insurance, Prudential, Raffles Health Insurance, and Singlife.  Every Singapore citizen and Permanent Resident already holds MediShield Life, covering pre-existing conditions for life at the subsidised, public hospital level.  The private component layered on top through an IP, AIA’s own HealthShield Gold Max included, does not automatically extend that same pre-existing condition coverage.  Underwriting decides case by case, and the outcome typically lands in one of two places: exclusion of diabetes-related claims, or acceptance with a premium loading.

Group Insurance: Still the Most Realistic Path

Group insurance underwrites the workforce, not each employee individually.  Employees with diabetes, hypertension, or a history of cancer can be covered without medical examinations or exclusions, provided the group meets standard participation criteria.  As a company director, structuring your own coverage through a company group health policy remains the most reliable route to genuine diabetes coverage, precisely because the insurer is pricing the group’s average risk, not scrutinising your individual HbA1c reading.

Diabetes-related complication costs in Singapore are projected to exceed S$10,000 per patient per year by 2050.  A director relying on personal underwriting, hoping a product built for Type 2 diabetics will stretch to cover his Type 1 condition, is planning against rising costs with a policy never designed for his risk profile in the first place.

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Terence Nunis | Executive Chairman, Equinox Zenith | Author, The 1% Playbook: The Billionaire Cheat Code

Quora Answer: How Do You Think the Remains of ISIS Should be Dealt With?

The following is my answer to a Quora question: “How do you think the remains of ISIS should be dealt with?”

There are two elements of consideration.  The first is the actual people, the fighters, the enablers, the sympathisers and the supporters.  The second is the organisational structure, including the weapons stockpiles, literature, funds, and other assets seized.  The actual fighters should be tried for crimes against humanity, and I favour summary executions.  I would extend the severe penalties to the so-called ISIS brides, the people who spread their propaganda, the people who sent funds, and the people who enabled others to enter ISIS territories from all over the world.

In that sense, the Singapore or Israeli model of dealing with extremists, including legal instruments such as detention without trial, and other measures of surveillance, work best in the deradicalisation effort.  These organisations are effectively neutered by destroying their support.  These organisations are run on more than just guns and bombs.  There is a lot of work tracing funds along traditional and non-traditional banking networks, systematically shutting down avenues, and accounts; and seizing assets.

Then, there is the work of cleaning up mosques and Muslim organisations, identifying and eliminating hate preachers, taking down web portals and social media accounts, identifying and banning literature. All of this involves investigating banks, small businesses, and publishing houses.  All that money had to be laundered somewhere to fund the propaganda effort.  We must understand that for every fighter, there are a thousand people who aided, abetted, and funded him.  They put together the literature to inspire them.  They were the people preaching hate on the pulpits.  They are the people who provided travel documentation.  They are the people who sent money.  All of them must be taken down, and made to pay a legal price.  This is the real work of pulling weeds out at the root.

Quora Answer: If a Stock Crashes, is There Insurance?

The following is my answer to a Quora question: “If a stock crashes, is there insurance?”

How do we insure against a stock crash?  What are we insuring?  You cannot insure against how the market values equity, except by hedging your investment, which functions as a limited form of insurance against loss.  You can, however, insure the company itself against specific liabilities, such as a massive payout due to an accident, legal action, and loss through accident, or perhaps, political exposure.  This does not insure the stock, but insures the business itself.  That payout can then be used to buy back some of the stock to protect leverage, or, at least mitigate the loss.

Quora Answer: When Should I Buy Life Insurance for My Child?

The following is my answer to a Quora question: “When should I buy life insurance for my child?”

If you are able to afford it, it is possible to buy coverage for your child while you are from the second trimester.  This provides coverage for pregnancy complications, some childhood diseases, and death.  In some policies, it is a rider on a policy where the actual life insured is the mother.  Within a certain period after birth, the life insured can be transferred to the child, or there is an option to buy coverage on the child with no or minimal underwriting.  In principle, it is always better to get coverage from as early as possible.  This hedges against exemption from preexisting conditions.  Also, the premiums are cheaper the longer the payment period.

Quora Answer: Where Does Life Insurance Pay Out to if There is No Beneficiary?

The following is my answer to a Quora question: “Where does life insurance go if there is no beneficiary?”

Should there be no nominated beneficiary for a life policy, the policy pays out to the estate of the deceased, and distributed according to the will.  It comes under the administration of the executor of the estate.  If there is no will, and the deceased passed away intestate, the payout will still be consolidated with the rest of the estate, and distributed according to intestacy laws.  If there was a beneficiary, and the beneficiary predeceased the deceased, meaning that the beneficiary passed away before the life insured, the policy pays out to the estate as if there was no beneficiary.

Quora Answer: How Does Life Insurance Work?

The following is my answer to a Quora question: “How does life insurance work?”

In Singapore, life insurance pays out upon the death of the life insured.  Should the policy also cover disability or critical illness, it may pay out upon confirmation of disability, and diagnosis of critical illness.  For disability, it is the inability to perform at least three of the six activities of daily living: washing, dressing, using the toilet, feeding, moving around, and transferring yourself, such as from bed to chair.  For critical illness, the diagnosis has to be or confirmed, by the panel doctors.  In the case of accidental death, the policy pays out upon supply of the certificate of death and the coroner’s report.  Death by natural causes requires only the certificate of death.  The policy is normally paid out by cheque.  This process does not take long.