Investing across borders: Trends in Singaporean and US markets

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You're listening to Mobile Money by Moomoo Demystifying Markets One Episode at a Time.

Hi, welcome to Mobile Money by Moomoo. I'm your host, Justin Zacks Vice president of Strategy at Moomoo Technologies. I spent my whole career in and around financial markets. This is a show that helps investors gain a better understanding of markets and their money.

Today we have a very special guest all the way from Singapore, it's Olivia Higgins. Welcome, Olivia. Pleasure being here. I mean, with technologies and of course, in person with Justin Zacks, you you've seen us a couple of times on the moo community and on our live webinars. And just a little bit about myself. I come from Singapore, but I'm actually Singapore an Australian, and I've actually lived all over the world, but particularly in Los Angeles.

And now I'm back here in Jersey City, in New York, you know, just exploring the area in Moomoo Singapore, I'm the lead presenter and we're always crafting content just to make it both entertaining and also educational for everyone. Really happy to be here. Justin thanks to have you today. We're going to talk a little bit about Singapore and the U.S. and what some of those differences are.

Justin I do have a question. Let's kick start the topic on the expenses between both countries. Singapore and New York. But Singapore has topped the charts for 11 years, nine times. That's surprising to me because everyone knows how expensive New York is. The average rent in Manhattan. Take a guess. my goodness. Per month in USD, I would say seven k.

It's actually not that high. $4300. Okay. That's a lot of money for a lot of people. So an average apartment to buy, to buy. How much do you think to buy? Okay. So I would say perhaps just a normal sized bachelor between one bedroom and two bedrooms. So 700,000. It's one 1.6 million. Okay. 1.6 million. Very, very close of those costs.

And obviously, you know, Manhattan is an island. Singapore is an island. Hard to get everything there. And so that must be something that drives the cost. Yes. I mean, in Singapore, I mean, it's definitely very competitive in that sense. But also because we are extracting so many people from around Asia Pacific and the world, we're trying to also accommodate for the local population, both the cost of living of everyone, but at the same time trying to figure out how we can remain competitive and keep it livable for people, Right.

I mean, that's something that the new generation is trying to figure out. You know, we have a lot of people that make a lot of money, and obviously they're not having too many problems. They do complain about their taxes, but everyone does. But it's really on the lower end that people are struggling. And there has been an effort to pay what it's called a livable wage in some of these high cost states.

You've seen them increase as much as $15 and beyond. And still $15 is really not enough to get by in Manhattan. Even if you work, you've probably even if you work 60 hours, it's just not just 40 hours. It's still not enough to pay those types of rents and cover your health care costs and everything else. It's a real struggle for a lot of people on the on the low end.

The tipping culture in the U.S. So that's something that a lot of the world, you know, they're trying to always try to adapt to. Right? So let's try to make sense of that. How does that relate to the minimum wage? Good question, because in certain states you have a regular minimum wage. You work in somewhere where that's a tip job, say a waiter or a waitress.

Two or $3 would be the minimum that you can make. People wouldn't then expect customers determine your salary. And to me it is a little bit crazy. Like, wouldn't it be better that your manager determines like how much money you make? Not someone that's having a bad day and doesn't want to give you a good tip or you know you're on the way there, give you a massive tip and then your your coworker doesn't get it and you just start with the luck out.

It's become a de facto thing in the U.S. and certain places have tried to do away with it, but they don't want the Americans love to have control, so they want to be able to tip and determine these types of things. So I don't think the tipping culture is going away. And in fact, it's it's kind of gone the opposite way now.

For instance, just the cash register person that's ringing you up, say, ten years ago, people did not tip. We do have something called the GST. Goods and services tax the informal tip, but that actually doesn't go directly to the person serving you. It does go to the business and then ultimately to the government. And what about what about income tax?

I know here in the US, you know, people at the top pay more percent and the people at the bottom pay a little bit less percent, but on average it's still quite high in probably the median person pays maybe around 25% of their income. The biggest chunk is federal, but we have state taxes and then your local town or city may also have a tax on income.

Some of them do. New York City does. 25%. That's that's a big chunk. And people think, well, I make you know, you make a good wage and then right off the bat, 25%. What about what about in Singapore? So in Singapore, it's also progressive. So it goes by brackets. But you got to hit a particular minimum salary to then have to pay tax.

So everyone doesn't have to pay tax. You pay in different forms, maybe in your day to day living in your you know, when you go to a restaurant and stuff all that accumulate, it will eventually go to the government. They really want to make sure that they retain that competitiveness. So they want to keep that tax rate as low as possible.

How does what is savings look like? You know, where Moomoo is here, we're an investing app and we're trying to help people, you know, with their financial future. And that can be difficult if you can't even save any money. So you know how to satisfy savings. Look in Singapore. So in Singapore there's a for saving system. So every month your employer has to pay something called the CPF, which is called the Central Provident Fund.

And that's just a percentage of your monthly income that is paid by your employer, which you can't touch until you decide to actually check out at a particular age. Or if you meet the requirements, it's part of your income. And then we minus the CPF and that's where we get the net income as of 2023, the average salary in Singapore is actually 5783 per month.

What I found very interesting, if you look at GDP, Singapore per capita is the third best per capita GDP of any country in the US is only ten. That shows that, you know, Singaporeans are that are able to earn that money, but it's still the wage is still tough given how expensive everything is. You know, the real wages have are starting to creep up here a little bit.

But it's very Singapore, too. You know, the the salaries are not increasing as fast as the inflationary environment. There are concerns with that and I think that's where the government actually steps in and gives like incentives to like the lower medium income families. But also you can be super successful, prosperous, but at the same time, you know, you need the right people in place to maintain some sort of balance.

Let's talk about Gini coefficient that you, you, everyone but see what that means. I'm sure some of our listeners might not understand. It's actually index, right to actually determine, you know, what is the difference between the gap between the highest earners in the country and also the lowest. Yeah. Countries may have. So if everyone made the same amount, they, you know, that would be much different than if one person made all the money and everyone else does almost nothing.

And so in the US, what they call a wealth gap, one of the bigger wealth gaps among developed nations in the US, about 58% of households have a brokerage account. And you know, we really want to change that. Americans in general are not great savers. The personal savings rates about 4% of your income right now, and it's it's averaged probably a little over 8%.

But that's not much. You know, when you're saving for a house college, which is, you know, is a huge part of college, it's something that everyone talks about. Right. And that sometimes set people back jumps of how they can move forward and how good they can save. If you have to pay for college or you take out loans to pay for college, you're paying those back.

So, you know, you want to save for a house and you want to save for retirement. I'm curious to know about Singapore, because I actually I'm really not sure you can't really fully explain it, but I think it's it's more of how everyone talks about finances, like we actually talk about it with our families. My dad would always talk about investment and like, this is how you can do business and all that.

My mom's always talking about saving and making sure that you only, you know, spend on what you need. Well, that's good to hear because in the U.S. it's really the opposite. A lot of parents don't talk with their children about money. It's not taught in schools at all at the primary level. And very little I think that can be better all over the world.

Right. But I know you guys also move out of the house really early, right at 18. Yeah. So a lot of people are thrown into that, the norm now. It's changing. I mean, it used to be the norm because you could afford to do so. But now I think, you know, people go to college now. So it used to be not as many people went to college.

Now a lot of people are going to college, so they might move out after college, but it has become so expensive housing wise that a lot of people are delaying that and they're moving back in with their parents after college so that they can save enough money for a down payment, or at least for, you know, a couple of years of rent.

A lot of people live with their parents for a long time until they get married, because just purchasing a house, you have to be married to actually apply for the house. And then you have to wait about two years for that to be built. So they call it, you know, the built to order homes and they call it BTO in Singapore.

And this is part of the Housing Development Board in Singapore that actually really, really helps with the costs. You know, in Singapore it's just really hard for because of the population size. So they have to make sure that, you know, they cater to the future generation. I'm just also curious, you know, in terms of investing, you know, what are what are Singaporeans interested in investing in?

You know, I always think of Singapore as being this high tech center. You know, are they really interested in these technology stocks or what what moves the needle, the US market? That's number one. I think a lot of the times we're talking about the US market, definitely the tech sector is, you know, what is hot right now. They're always in the know.

We have, you know, a lot of conversations, even just with friends about what's upcoming. But I think at the moment, especially last year, we had a lot of conversations about retail. So we're talking about the real estate investment. So do you have to be married to buy one of those? No, fortunately not. But you know, the retail sector, you know, we're talking about even sustainability.

So Singapore has a green plan for 2030. We're trying to really push for it, just full electric vehicles on the street, Singaporeans and also residents investing in the sustainability themes. A lot of green farming, vertical farming, Singapore, you've got all these buildings very, very similar to New York itself. If you look at our skyline, of course, New York is much bigger, but in Singapore a lot of the buildings have plants on them out of this world architecture.

I mean, if you go to Singapore, you go to the cloud forest or the flower dome, create it indoors as a self-sustaining system. So we need to create these things in buildings. We can have a controlled environment using tech. We can definitely start to create more resources. And that's just a testament when I think of the U.S. we have so many great natural resources, great farming system, and so we have so much of that.

We don't have to import it. You have abundant resources, but in Singapore, you know, we only have talent. That's our export, right? That's our expertise as well. We rely on people because we don't have that which is an island city. Over the years. You've got an incredibly creative. So one thing is new water. Do you know what that is? No.

What does that So that's actually water that's recycled. And one of the recycling places, of course, comes from the toilet and urine. Yeah, but that's a long way people feel about drinking that water. I mean, it tastes it tastes like the government decided we need to be self-sustaining, you know, self-reliant from that small city. I think that translates to the behavior of Singaporeans and also the residents that live there.

Sustainability is so important for, you know, for everyone, even if you have the resources, because I don't care where you are, these fossil fuels will eventually run out and every country is going to have to think about alternatives for them. And, you know, here, here, you know, a lot of people are interested in electric vehicles. I know a lot of our a lot of our listeners are interested in these stocks.

We hear the from the US perspective, though, it's such a big country, so it makes it a lot harder to, you know, do all these charging stations and the infrastructure becomes a Singapore. It's kind of small, so maybe you guys can solve it faster. But I heard it's it's expensive to have a car there. Yes. How does that work?

You so just go by car. No, you don't. So we. Okay, so first of all, for the train systems, you know, their plan was to actually have a train station like 400 meters from every part of Singapore. Right. So it just kind of interconnected. But the reason why they have to do that, because most Singaporeans don't own a car, because it's just getting more expensive.

And also with this EV movement in place, they're just going to eradicate more cars and road number one because we don't have the space. Number two, it's also the the cost rate. So there's something in Singapore called the COE and that's the certificate of entitlement. That's the entitlement to own a car. So the car itself, it's the right to actually buy a car.

You have to bid for it. So it doesn't mean that you actually get it. So right now, I've got the stats right here. It actually fluctuates the certificate of in time in the COE premium for the open category all time high at 152,000, just to have the right to purchase a car. Then you look at the cars you want to buy.

Right. 252 Well see if you already if you can afford 152, you're probably going to want to buy a nice car. Exactly. That's like no one's buying a $10,000 car. Exactly. So even if you had a $10,000 car in in the US, you can you can get quite good cars for that. Right. But if you buy that same car in Singapore, it's going to be at least, you know, 100, 200 K and then you have tax on top of that.

So altogether looking at 300 500,000 for even just Yeah, that's most Americans would find that pretty crazy. A lot of people in America, you know they want to make cars affordable. But the interesting part is we do have something very similar, these entitlement licenses. And, you know, I know you wanted to talk a little bit about sports and, yeah, the American football.

But some of these some of the American football stadiums, they have what's called a personal seat license. So you actually have to buy the license first, and that entitles you to buy tickets. And these tickets are not cheap. I mean, they're not nowhere near cheap. Do you think about New York? What do you think the difference is? And what what do you find the most interesting or weird or different?

New York has a charm to it. A lot of history. And what I notice is it's so similar to Singapore as well in terms of the people. Everybody was sort of always on the move. How much they really love culture. I think that that's something New York has and I want to experience more of that. A lot of great culture here in New York, and I think a lot of people are really interested in that from art, art, sports, history, history, all of it, you know.

So yeah, really interesting here in in again, it's great to have you here. Really, really happy to be here as well. And we're really looking forward to the content that we'll be producing together. I'm going to go to financial districts I'm really looking forward to. Yeah. So, you know, you know, if you're if you're watching, you know, listening to the podcast, you know, check us out in the community, in the community.

And Lovie and I do webinars probably every couple of times a quarter, introducing a lot of content. And hopefully you can find that either on the moo website or in the community. And so we'll be posting it and you know, certainly can follow all the Moomoo socials to see what we're doing here and what we're, you know, what's next to come.

Today we definitely we just wanted to talk about just how different countries and how they correlate. You know, let's end off just with how, you know, U.S. and Singapore, Asia, how we're all interconnected. The world is becoming smaller and smaller. And, you know, as small as people think Singapore is, it's big in us is now small. So the idea of globalization and so many things every day, everything you put on, everything that is in your house in here in the US, at least part of it's probably produced somewhere else in the country.

So trade is just so important for all of these countries. And in terms of trading, in terms of these stocks, what's going on in all the different markets and a lot of people in the US to US centric and focused on what's going on U.S. markets and there's lots of other markets, there's lots of other interesting things going on, but they're all going to influence these US companies in this US stocks.Even if you only want to trade US stocks, you really a lot of good understanding and hopefully the listeners today have gained somewhat of what of an understanding of Singapore and because it's important to have an understanding of all these different countries and how their economies work and how their cultures are different from the United States. Look forward to seeing your comments and also what you want to see next, because, of course, Justin, this is just the first of many that will be working for podcasts and other content right now.

It was it was great to have you on the podcast. We'll see you next week. We'll see you next week, everyone. Have a great time. The opinions expressed are those of the host and a new guest speaker and not necessarily those of Moomoo Technologies Inc or its affiliates. The podcast is provided for informational educational purposes only and is not a recommendation or endorsement of any particular investment or investment strategy that may be mentioned or covered in the podcast.

All investments involve risk and the loss of principal as possible as performance does not indicate or guarantee future success. Moomoo is not affiliated with any outside guests or their companies. Information provided in this podcast is general in nature and may not be appropriate for all investors. The Moomoo app is an online trading platform offered by Moomoo Technologies Inc securities, brokerage products and related services available through Moomoo App or offered by Moomoo Financial Inc, a member of FINRA SIPC.