Equinox GEMTZ

🌟 𝐔𝐧𝐥𝐨𝐜𝐤 𝐘𝐨𝐮𝐫 𝐅𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐏𝐨𝐭𝐞𝐧𝐭𝐢𝐚𝐥 𝐰𝐢𝐭𝐡 𝐄𝐪𝐮𝐢𝐧𝐨𝐱 𝐆𝐄𝐌𝐓𝐙! 🌟 We're thrilled to share an insightful piece penned by our Executive Director, Mr. Eric Tan. His latest article delves into the transformative power of "Bridging Loans"—a financial strategy that empowers high-net-worth individuals to seize opportunities and expand their wealth horizons. 🔑 𝐖𝐡𝐲 𝐁𝐫𝐢𝐝𝐠𝐢𝐧𝐠 𝐋𝐨𝐚𝐧𝐬 𝐌𝐚𝐭𝐭𝐞𝐫: In the fast-paced world of finance, timing can make or break an opportunity. For those of you who are always on the lookout for strategic investment avenues, understanding and utilizing bridging loans could be your key to gaining a competitive edge. These loans provide immediate, short-term access to capital, allowing you to act swiftly and decisively. 📈 𝐖𝐡𝐚𝐭 𝐘𝐨𝐮'𝐥𝐥 𝐋𝐞𝐚𝐫𝐧 𝐟𝐫𝐨𝐦 𝐭𝐡𝐢𝐬 𝐀𝐫𝐭𝐢𝐜𝐥𝐞: - 𝘼𝙘𝙘𝙚𝙡𝙚𝙧𝙖𝙩𝙚 𝙔𝙤𝙪𝙧 𝙄𝙣𝙫𝙚𝙨𝙩𝙢𝙚𝙣𝙩𝙨: How bridging loans can fill the gap between current liquidity and future financing, enabling rapid asset acquisition. - 𝙈𝙖𝙭𝙞𝙢𝙞𝙯𝙚 𝙔𝙤𝙪𝙧 𝙒𝙚𝙖𝙡𝙩𝙝 𝙂𝙧𝙤𝙬𝙩𝙝: Discover the smart utilization of Indexed Universal Life (IUL) policies, which serve as a unique bridging finance tool while protecting and growing your capital. - 𝙎𝙩𝙧𝙖𝙩𝙚𝙜𝙞𝙘 𝙁𝙞𝙣𝙖𝙣𝙘𝙞𝙖𝙡 𝙎𝙤𝙡𝙪𝙩𝙞𝙤𝙣𝙨: Real-life examples show how our clients have successfully used these tools to pivot and thrive in today’s dynamic market. 🚀 𝐄𝐦𝐩𝐨𝐰𝐞𝐫 𝐘𝐨𝐮𝐫 𝐅𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐉𝐨𝐮𝐫𝐧𝐞𝐲 It’s crucial for investors and financial strategists to be aware of every tool at their disposal. Bridging loans can redefine how you approach your wealth-building strategy—transforming potential missed opportunities into lucrative realities. We invite you to dive into this article and discover how these strategies can be tailored to enhance your financial endeavors. Don’t let timing constraints hinder your growth; instead, leverage knowledgeable insights and tailored financial solutions offered by Equinox GEMTZ. 🔗 𝐑𝐞𝐚𝐝 𝐭𝐡𝐞 𝐟𝐮𝐥𝐥 𝐚𝐫𝐭𝐢𝐜𝐥𝐞 𝐚𝐧𝐝 𝐜𝐨𝐧𝐧𝐞𝐜𝐭 𝐰𝐢𝐭𝐡 𝐮𝐬 𝐨𝐧 𝐋𝐢𝐧𝐤𝐞𝐝𝐈𝐧 to explore how you can integrate bridging loans into your wealth-building plans. #EquinoxGEMTZ #FinancialStrategies #BridgingLoans #WealthManagement #InvestmentOpportunities

In Fiscal Year (FY) 2019, U.S. Customs and Border Protection (CBP) reported approximately 977,509 encounters at the southwest border.  In FY 2020, encounters decreased to about 458,088, influenced by the COVID-19 pandemic and associated travel restrictions.  In FY 2021, there was a significant increase to over 1.7 million encounters, surpassing previous records.  In FY 2022, the upward trend continued, with CBP reporting over 2.3 million encounters.  In FY 2023, up to September, preliminary data indicates that the high levels have persisted, though specific numbers should be verified with the latest CBP releases. Ongoing violence, poverty, and political instability in countries like Honduras, Guatemala, and El Salvador contribute to increased migration.  There are shifts in US immigration policies, such as the termination or implementation of asylum restrictions, affect migration patterns.  A notable percentage of encounters involve repeat crossers due to policies like Title 42 expulsions, which facilitate rapid return without formal deportation proceedings.  There has been an increase in the number of family units and unaccompanied children arriving at the border, posing additional challenges for processing and humanitarian care. There has been a sharp rise in fentanyl seizures.  In FY 2022, CBP seized over 14,000 pounds of fentanyl, a potent synthetic opioid. Seizures of methamphetamine, cocaine, and heroin also remain significant.  The majority of drug seizures occur at official ports of entry rather than between them.  Traffickers use sophisticated methods, including hidden compartments in vehicles and commercial goods.  Criminal organisations facilitate the illegal crossing of migrants, often exploiting them financially and subjecting them to dangerous conditions.  Cases of human trafficking for forced labour or sexual exploitation are a concern, though quantifying the extent is challenging due to the covert nature of these crimes. After a decline in FY 2020, the number of encounters has increased substantially in FY 2021 and FY 2022, reaching record highs.  The upward trend is influenced by various factors, including global economic conditions, pandemic impacts, and changes in enforcement policies.  The significant rise in fentanyl seizures indicates increased trafficking efforts or improved detection capabilities.  Despite enforcement efforts, the flow of illicit drugs remains a major issue. The data supports the view that there is a substantial challenge at the border, with increasing numbers of illegal crossings and ongoing illicit trade.  Debates continue over the effectiveness of various policies proposed or implemented by different administrations, including border wall construction, changes to asylum procedures, and cooperation with neighbouring countries.  While I am not a fan of Donald John Trump, according to the data, he is not wrong. Terence Nunis Terence K. J. Nunis, Consultant Chief Executive Officer, Equinox GEMTZ

Tariffs raise the cost of imported steel and aluminium, which are essential raw materials for many industries.  Copper, nickel, zinc, and other industrial metals see price increases as manufacturers seek alternatives or face higher input costs.  Oil and natural gas prices rise due to increased energy consumption in domestic steel and aluminium production.  After the US imposed a 25% tariff on steel and a 10% tariff on aluminium in 2018, the Producer Price Index for metals and metal products rose by 14% within a year.  This led to increased costs for industries like automotive and construction, which rely heavily on these materials. Manufacturers may substitute steel and aluminium with other materials to mitigate cost increases, driving up demand and prices for plastics and composites, which are used as alternatives in automotive and aerospace industries; and wood and cement, for construction.  Following the tariffs, the price of lumber saw an uptick of 5%, as some construction projects shifted from steel to wood framing where feasible.  Difficulty accessing affordable steel and aluminium delays projects, affecting demand for other materials used in manufacturing and construction.  Delays in infrastructure projects led to decreased demand for cement, causing prices to stabilise despite seasonal expectations for growth. Countries affected by U.S. tariffs often impose their own tariffs on American exports, particularly agricultural goods.  In 2018, China imposed tariffs on U.S. soybeans, leading to a surplus in the US market and a price drop of over 15%, from US$10.50 to US$8.90 per bushel within months.  US soybean exports to China fell by 50%, affecting prices globally.  Tariffs strengthen the US dollar as investors seek safe-haven assets, making dollar-denominated commodities more expensive for other countries.  The US Dollar Index (DXY) rose by 5% during periods of heightened trade tensions, leading to reduced demand for commodities like gold and oil in emerging markets due to higher costs. Slower economic growth reduces industrial activity, decreasing demand for energy commodities.  The International Monetary Fund (IMF) reduced its global growth forecast by 0.2% in 2025 due to trade tensions, correlating with a 10% drop in Brent Crude Oil prices.  Increased uncertainty leads to higher investment in safe-haven assets like gold and silver.  Gold prices increased by 8% following tariff announcements as investors sought to hedge against market volatility.  Reduced manufacturing lowers demand for copper used in electrical equipment and construction.  Copper prices fell by 7% in 2018 amid escalating trade wars, reflecting concerns over global industrial demand.  This also impacts nickel and zinc, which are essential for stainless steel (nickel) and galvanisation (zinc).  Prices fluctuate based on changes in steel production levels. (Continued) Terence Nunis Terence K. J. Nunis, Consultant Chief Executive Officer, Equinox GEMTZ

Tariffs on key materials like steel, aluminium, semiconductors, and pharmaceuticals have increased production costs for manufacturers worldwide.  This has disrupted global supply chains, leading to higher prices for goods and services. Companies are seeking alternative suppliers and manufacturing locations to avoid tariffs, leading to shifts in global supply chains.  This transition is costly and time-consuming, impacting production efficiency and timelines.  The tariffs have led to a decline in trade volumes between the US and its trading partners. The European Union (EU) could lose up to 3.7 million tons of steel exports to the US due to the new tariffs.  The International Monetary Fund (IMF) has highlighted that the tariffs contribute to economic uncertainty and could slow down global economic growth.  The IMF expects global economic growth to be around 3.3% in 2025, but this could be lower, if trade tensions persist. Countries affected by US tariffs, such as China, Canada, and the EU, have imposed retaliatory tariffs on US goods.  This has escalated trade tensions and led to a trade war, further impacting global trade and economic stability.  Retaliatory tariffs have reduced demand for US exports, affecting industries such as agriculture, manufacturing, and technology.  This has led to job losses and reduced economic growth in the US.  Tariffs increase the cost of imported goods, leading to higher prices for consumers.  This has contributed to inflationary pressures in many countries.  The European Central Bank (ECB) has highlighted that tariffs are a major challenge for the European economy, leading to higher prices for steel and automobiles.  Higher prices for goods and services reduce consumers’ purchasing power, leading to lower consumer spending and economic growth. The US tariffs on automobile imports have significantly impacted the European automotive industry.  German car exports to the US could drop by as much as 7%, and Italian car exports by 6.1%.  The tariffs on semiconductors and other technology products have disrupted the global technology supply chain, leading to higher production costs and reduced competitiveness for tech companies.  The introduction of new tariff policies has bolstered the US dollar, denting the value and stability of other currencies like the euro.  This has led to increased volatility in foreign exchange markets.  The announcement of tariffs has led to significant declines in stock markets worldwide.  STOXX Europe 600 recorded its largest single-day decline of the year following the announcement of new US tariffs.  US tariffs are expected to reduce global GDP growth.  The IMF estimates that the tariffs could reduce global economic output by 0.4% over the next decade.  The tariffs have led to job losses in affected industries.  The European steel industry could lose up to 18,000 jobs due to reduced exports to the US. Terence Nunis Terence K. J. Nunis, Consultant Chief Executive Officer, Equinox GEMTZ

The semiconductor industry is highly globalised, with complex supply chains that span multiple countries.  US companies rely on Chinese manufacturing capabilities and the Chinese market for a significant portion of their revenue.  Applied Materials and Lam Research have seen substantial revenue drops from China due to export controls.  China is not only a major manufacturing hub but also a significant consumer of semiconductors.  More than 50% of the semiconductors manufactured by Chinese companies are consumed domestically.  This makes it difficult for US companies to find alternative markets that can match China’s demand. China has responded to US export controls with its own restrictions, such as the new export licence system for critical materials like gallium and germanium.  These materials are essential for semiconductor production, and China’s control over their supply affects global supply chains.  Retaliatory measures by China have already impacted US companies.  Lam Research reported a 10% year-on-year drop in revenue from China in the last quarter of 2024. The US semiconductor industry is a significant contributor to the national economy.  The Semiconductor Industry Association (SIA) estimates that the industry supports over 1 million jobs and contributes approximately US$246 billion to the US GDP annually.  Disruptions in this industry have a ripple effect on the broader economy.  US semiconductor companies have reported significant revenue declines due to export controls and reduced access to the Chinese market.  The combined revenue loss for major US semiconductor companies is estimated to be around US$15 billion annually.  The CHIPS and Science Act aims to boost domestic chip production with US$52.7 billion in funding.  However, conditions attached to the funding, such as stock buyback limitations and profit-sharing requirements, deter some companies from participating.  This limits the effectiveness of the Act in revitalising the US semiconductor industry.  While the US has managed to get key allies like Japan on board with export controls, the overall impact is limited by the global nature of the semiconductor supply chain. Despite US efforts to curb China’s semiconductor advancements, China continues to make progress in developing its own semiconductor technologies.  This reduces the effectiveness of US export controls over time.  China has significantly increased its R&D investments in the semiconductor sector, aiming to reduce its reliance on foreign technology.  This includes substantial government incentives and support for domestic semiconductor companies.  The American policy is self-defeating. Terence Nunis Terence K. J. Nunis, Consultant Chief Executive Officer, Equinox GEMTZ

Approximately 70% of high-net-worth individuals (HNWIs) in Greater China have integrated insurance into their asset portfolios.  This highlights the growing recognition of insurance as a valuable component of financial planning.  Around 30% of respondents allocate 11% or more of their assets to insurance products.  This underscores the importance placed on insurance for wealth management.  Life insurance is the most commonly held policy among HNWIs, with nearly 78% of respondents owning a life insurance policy.  This type of insurance is favoured for its ability to provide financial security and facilitate wealth transfer.  Medical insurance is also widely adopted, with 76% of respondents holding such policies.  This ensures that healthcare needs are covered, reducing the financial burden on heirs.  Savings insurance, held by 60% of respondents, combines savings and protection, offering a dual benefit of wealth accumulation and risk management. A significant 64% of respondents prioritize the distribution of their assets in a manner that prevents inheritance disputes.  Insurance policies with designated beneficiaries achieves this goal by providing clear and legally binding instructions for asset distribution.  Nearly 67% of respondents believe that designating beneficiaries through insurance mitigates conflicts during the wealth transfer process.  This ensures a smoother transition of assets to future generations.  Insurance provides a reliable means of achieving financial stability and managing risks.  It ensures that heirs receive a predetermined amount, regardless of market fluctuations, or other uncertainties.  In certain jurisdictions, insurance products offer preferential tax treatment, such as tax exemptions, deferrals, and deductions.  This makes insurance an attractive option for estate planning. Insurance has evolved from a traditional risk management product to a comprehensive legacy planning tool.  It now mimics some key features of wills, family trusts, and limited power of attorney, making it accessible and effective for HNWIs.  Families are becoming more open-minded about starting legacy planning at a younger age.  Recognising the benefits of facilitating smooth wealth transitions and maintaining harmonious family relationships, they are increasingly incorporating insurance into their financial strategies. Terence Nunis Terence K. J. Nunis, Consultant Chief Executive Officer, Equinox GEMTZ

According to a 2021 study, a single elderly person aged 65 years and above, without chronic illness, needs approximately S$1,421 per month to meet basic needs.  This includes essentials like food, healthcare, and transport.  For a more comfortable retirement, including leisure activities and occasional travel, the required amount can be significantly higher. Estimates suggest that a couple might need around S$3,000 to S$4,000 per month to maintain a comfortable lifestyle. According to the OCBC Financial Wellness Index 2024, the latest survey reveals that the percentage of Singaporeans actively planning for retirement has dropped from 60% to 54%.  This means nearly half (46%) of respondents have not begun preparing for their retirement.  A significant portion of Singaporeans face a shortfall in their retirement savings.  A survey by Manulife found that only 35% of respondents have a retirement plan in place.  The Life Insurance Association (LIA) reported a critical illness protection gap of 74%, amounting to S$579 billion for economically active Singaporeans aged between 20 and 69 years.  A survey by FWD Singapore indicated that more than 68% of Gen Z respondents do not have coverage for critical illness events such as cancer, stroke, and heart attacks. Not enough people do enough to plan their retirement and investment needs.  Any form of financial planning needs to consider needs, dreams, and contingencies.  This requires thinking about investments, insurance and savings.  This is not something that can be done alone, without the assistance of a financial advisor. Terence Nunis Terence K. J. Nunis, Consultant Chief Executive Officer, Equinox GEMTZ

The banking system can experience a liquidity deficit due to factors such as high demand for credit, large outflows related to tax payments, increased currency circulation, and government borrowing programmes.  A surge in credit demand strains the liquidity position of banks.  Strong credit growth indicates a robust economy, but requires sufficient liquidity to sustain lending.  Corporates typically make advance tax payments in March, leading to substantial outflows from the banking system.  This reduces the liquidity available with banks.  Increased withdrawal of cash by the public, especially during festival seasons or financial year-end, reduces the funds available within banks.  Higher government cash balances with the Reserve Bank of India (RBI) absorbs liquidity from the banking system. RBI employs several instruments to manage liquidity, such as the purchase and sale of government securities to inject or absorb liquidity.  This absorbs excess liquidity by allowing banks to park surplus funds with the RBI, or injects liquidity by providing funds to banks against collateral of government securities.  RBI may use long-term repossession operations (LTROs) and targeted LTROs (TLTROs) to provide longer-term liquidity to banks at affordable rates to encourage lending to specific sectors.  Alternatively, cash reserve ratio (CRR) adjustments alter the amount of funds banks must hold with the RBI, impacting liquidity. Recent trends show credit growth in double digits.  If bank credit has grown by around 15% year-on-year, this indicates strong demand for loans from businesses and consumers.  Advance tax collections amount to significant sums, draining liquidity from the banking system during the payment period.  A large government borrowing programme absorbs liquidity as banks invest in government securities.  The banking system is experiencing a liquidity deficit of several lakh crore rupees, necessitating RBI intervention.  A deficit of ₹70,000 crore to ₹1 lakh crore indicates tight liquidity conditions.  RBI may need to inject around ₹1 lakh crore into the banking system by the end of March. Adequate liquidity infusion prevents a sharp rise in short-term interest rates, ensuring that borrowing costs for businesses and consumers remain stable.  Infusing liquidity enables banks to meet the credit needs of productive sectors, supporting economic growth and investment.  Managing liquidity prevents undue stress in the banking system, reducing the risk of defaults and maintaining confidence among depositors and investors.  Careful calibration ensures that inflation remains within target levels.  External factors like tightening monetary policies by major central banks impact capital flows and liquidity, prompting the RBI to take compensatory measures. Terence Nunis Terence K. J. Nunis, Consultant President, Red Sycamore Global

President Donald John Trump imposed extensive tariffs, including a 25% tariff on all steel and aluminium imports, as well as additional tariffs on goods from China, Mexico, and Canada.  These tariffs increased costs for American businesses reliant on imported materials and components.  Affected countries responded with their own tariffs on US goods.  China imposed tariffs on American agricultural products, impacting US farmers and exporters.  This escalation led to a trade war, exacerbating tensions and uncertainty.  Higher input costs due to tariffs squeezed profit margins for manufacturers.  Companies faced increased expenses for raw materials, which, coupled with decreased export demand, led to reduced earnings.  Technology firms reliant on global supply chains experienced disruptions.  Uncertainty around component costs and availability hindered production schedules and innovation efforts.  Farmers faced declining exports as key markets imposed retaliatory tariffs.  Surplus produce and falling commodity prices hurt rural economies and agricultural businesses. The unpredictability of trade negotiations created a volatile market environment.  Investors reacted negatively to tariff announcements and the lack of clarity on future trade policies.  Many companies revised their earnings forecasts downward, citing increased costs and decreased demand.  This eroded investor confidence and contributed to stock sell-offs.  Higher import costs led to increased consumer prices for goods ranging from electronics to household items.  Inflation fears prompted concerns about reduced consumer spending power.  In response to inflationary pressures and economic uncertainty, the Federal Reserve faced challenges in setting appropriate monetary policy.  Decisions regarding interest rates had significant implications for markets, sometimes adding to investor anxiety. The trade tensions contributed to a slowdown in global economic growth.  Reduced international trade flows impacted global supply chains and economic stability worldwide.  The lack of a clear, consistent trade strategy led to uncertainty. Businesses struggled to plan for the future, delaying investments and hiring.  This cautious approach signalled to investors that economic growth might slow down, prompting them to pull back from the markets. Terence Nunis Terence K. J. Nunis, Consultant Chief Executive Officer, Equinox GEMTZ

Corporate income tax collections reached S$30.9 billion in FY2024, higher than the estimated S$28 billion.  This increase was driven by industry-specific cyclical factors in finance and wholesale trade, as well as multinational enterprises choosing to place more of their high-end activities in Singapore.  Singapore’s economy expanded by more than 4% in 2024, contributing to higher corporate profits and, consequently, higher tax revenues.  Vehicle quota premiums exceeded expectations, reaching S$6.5 billion, up from the S$4.7 billion estimate.  This increase was driven by strong demand for vehicle ownership certificates, which are required for purchasing vehicles in Singapore.  GST collections rose to S$20.6 billion in FY2024, revised from S$19.4 billion.  This increase was due to stronger-than-expected growth in private consumption, reflecting a robust domestic economy.  Personal income tax collections increased to S$19 billion, up from the estimated S$18.1 billion.  This growth was supported by higher employment rates and wage growth in various sectors. Total expenditure for FY2024 was revised upwards by S$1.2 billion, or 1%, to S$112.9 billion.  This is 7.2% higher than FY2023’s actual expenditure.  The increase was driven by higher spending in the Ministry of Defence and the Ministry of National Development.  The Ministry of Health spent S$0.9 billion less than estimated, mainly due to reduced requirements related to Covid-19 and lower-than-projected take-up for community care salary enhancement schemes.  The budget provides more help for seniors, including those living in private property.  The Enhancement for Active Seniors (Ease) programme will be extended to seniors living in private property for three years, up to 2028.  Additionally, eligible lower-income seniors aged 55 to 70 who make voluntary contributions to MediSave will have their contributions matched dollar-for-dollar, capped at $1,000 a year. Terence Nunis Terence K. J. Nunis, Consultant Chief Executive Officer, Equinox GEMTZ