This year's numbers were all the more remarkable, given the weak economic climate.

One retailer, D-Link International, estimated its sales at this year's fair could rise up to 20 per cent from last year's. This was on the back of sales of network equipment like wireless Internet routers.

"What we sold during the fair could have made up for 11/2 months of normal business sales," said the company's sales director, Ms Estella Tan.

Exhibitor Audio House'smarketing consultant, Ms Joanne Wee, said that IT fairs are win-win situations because they are a "platform for many businesses to clear selected older models" and for consumers to find a "good deal".

However, many retailers felt that fairs may not be sustainable as the sole source of business.

Agreeing, a spokesman for retailer Challenger Technologies said: "It's not enough to cover our overheads."

Still, retailers are surprised at the strong demand during the downturn.

Queues snaked out of the exhibition halls and Internet forums were abuzz with activity, with forum posters suggesting what and where the good bargains were.

With no room to cut rates, the Bank must instead turn to direct means of influencing the money supply. This is important. The nominal growth rate of an economy can be no greater than the speed at which money is growing, and flowing around the economy. This famous economic equation – the quantity theory of money – lies behind the Bank's decision to create £150bn of money.

Whether it will succeed is another question, but Thursday's announcement means it has thrown its weight behind this new policy of quantitative easing with more weight and vigour than any other central bank in history.

THE BANK OF ENGLAND'S EMERGENCY WEAPONS

Liquidity support

How does it work? The Bank lends out money in return for collateral – usually government or company debt – to instill confidence in the market and provide cash with which to trade. It has been doing this for over a year through its Special Liquidity Scheme and its successor.

Pros The system does not meddle directly with monetary policy – so does not interfere with interest rate decisions – and it directly ensures that banks' balance sheets are kept above water.

Cons Although it addresses liquidity problems – ie. when financial institutions don't have enough cash to hand – it does not solve the credit crunch, in which banks are unwilling to lend cash at all.

Does it work? To an extent. It has ensured strains on the financial markets have eased in comparison with the early days of the crisis, but the amount banks are willing to lend remains extremely low.

Buying company debt

How does it work? The Bank buys, rather than lends against, the assets of private investors, be they pension funds, insurance groups or banks. The assets are most likely commercial paper (short-term company debt) and corporate bonds. It pays for the money from a pot of cash raised by the Government through issuing gilts – in other words without increasing the amount of cash in the system. This is what the Bank has attempted to do through the Asset Purchase Facility, and is what the Federal Reserve is doing in the US.

Pros If successful, it gets to the heart of the matter, reducing the cost of credit for companies and lubricating the capital markets for companies. Because the purchases are funded by the Government it is not particularly inflationary.

Cons It has proved very difficult for the Bank to get hold of the right type of commercial debt (in other words at a good price, and a type that won't default). Pay too little and you will leave the taxpayer facing a big bill in the coming years.

Does it work? To an extent. The Fed has bought billions of dollars worth of corporate debt, but with little impact on commercial bond spreads.

Buying gilts (Government debt)

How does it work? The Bank buys government debt off investors and banks rather than corporate debt. This is something the Bank had authorised by the Treasury yesterday. The aim is to bring longer-term interest rates down, ensuring that companies and lenders cut their own rates.

Pros: Gilts are gilt-edged, and so have very little chance of defaulting (and if the UK Government has defaulted that is a whole other kettle of fish to worry about) and there are plenty of them around, so are easy to buy.

Cons: It does not make any direct difference to companies' cost of borrowing, instead pushing down government interest rates: nice, but not the heart of the matter.

Does it work? Yes, if by that you mean getting long-term interest rates down. The Japanese did it in the past, but it has not yet been tried by the Fed.

Creating money to buy assets

How does it work? The Bank buys assets off private investors but funds those purchases by creating money (literally, with the push of a button; metaphorically, with printing presses). This is what the Government has now approved. The aim is to increase the amount of money in the economy, which will in turn increase either economic growth, inflation, or a combination of the two.

Pros: The UK faces a possible spate of debt deflation, and there are few more powerful weapons for a central bank to use than its printing presses. It can also aim to kill two birds with one stone and cut the cost of borrowing for companies by making cash more plentiful. With interest rates at zero, there are few other more powerful tools the Bank can employ.

Cons: In normal times, such a policy is potentially highly inflationary. There is every chance the Bank is unconsciously laying the ground for an uncontrollable wave of inflation in the future. Deflation is the big enemy at present but the threat may be overblown, and printing money – quantitative easing – will create a mess of unparalleled proportions to clear up afterwards.

Does it work? Yes and no. The only other time it has been used is by the Bank of Japan. As Japan is still trapped in stagnation, many say it failed. However, there is evidence the Japanese experience would have been worse had it not taken these measures. Some also argue that the BoJ was too slow to start quantitative easing.

The helicopter drop

How does it work? The bank prints money, piles it inside a helicopter, takes to the skies and scatters the cash across the nation. Suddenly, every family is richer – provided they get to the cash in time and have sharp enough elbows. This technically amounts to a tax rebate for everyone funded by money creation, and was christened a "helicopter drop" of money by economist Milton Friedman. In his eyes it was the most dramatic way for the central bank to get money out into the streets.

Pros: This instantly gets money into people's hands and, with any luck, gets them spending it in the high street. Those who don't spend can use it to pay off debt, which isn't such a bad thing either.

Cons It is so radical a policy it might scare away international investors from the UK. It displays a disregard for controlling inflation that could also send sterling plunging. It will summon up even more vivid comparisons with Zimbabwe and Weimar Germany.

Does it work? It has never been properly tried before. The Japanese and Koreans have experimented with issuing vouchers to their citizens in the hope of encouraging them to spend but these were – importantly – not funded with created money. Fed Chairman Ben Bernanke is convinced, however, that in desperandum it would pump up a deflated economy.

In January 2008, the Singapore sovereign wealth fund bought about US$6.88 billion worth of perpetual, convertible notes in Citigroup. These preferred stocks would pay a 7 per cent annual dividend.

Preferred shares are similar to bonds in that holders receive a fixed dividend. By getting preferred shareholders like GIC to convert their holdings into common stock, Citi will be able to reduce its quarterly dividend payment.

The US Treasury Department has said it will convert part of its holdings of preferred shares into Citigroup common stock. So too will some other large preferred stockholders, including Saudi Arabia's Prince Alwaleed Bin Talal Abdulaziz Alsaud.

In a statement, GIC said it supports the initiative by Citigroup and the US government to strengthen the quality of the bank's capital base in view of the challenging economic environment.

The US government will now take a US$25 billion stake in troubled Citigroup, with the conversion of its preferential stock into ordinary shares.

Separately, Citigroup has announced it will record another US$10 billion worth of writedowns as part of its already-released fourth quarter results. This brings its net loss for the year to US$27.7 billion.

According to Lipper, a fund research and analysis firm, unit trusts available under CPFIS retreated 40.24 per cent on average while investment-linked insurance products (ILPs) fell 36.06 per cent.

But CPFIS investors who put their cash into bond funds gained 1.9 per cent over the previous year.

Among the CPFIS-included ILPs, bond global funds and bond Singapore funds were consistently the best performers over the last three years, said Lipper on Wednesday.

The DWS Lion Bond SGD, for example, is one of five top performing unit trusts named Lipper Leaders.

Lipper noted that during 2008, the MSCI World Index shed a total of 40 per cent, while the Straits Times Index (STI) lost 49 per cent.

The last quarter of 2008 alone saw CPFIS-included funds lose an average of 16.82 per cent, as global bourses slumped after the failure of Lehman Brothers.

Even before that, nearly half of all CPFIS investors - or 440,000 of them at the time - who sold their Ordinary Account (OA) investments in the year ended Sept 30 had lost money.

Still, figures from the CPF board show that CPF members remain invested in insurance policies and unit trusts.

As at Sept 30, CPF members had withdrawn $7.8 billion from the CPF-Special Account for investments, of which nearly 80 per cent, or $6.19 billion, went into insurance policies, and about $1.61 billion in unit trusts.

As at Dec 31, total investment was $7.7 billion - $6.1 billion into insurance policies and $1.5 billion into unit trusts.

For individuals with an annual income below $30,000, who are therefore not eligible for credit cards, a maximum credit limit of two times the borrower's monthly income will apply.

The minimum annual income for credit cards remains unchanged at $30,000 for individuals at or below 55 years, and $15,000 for individuals above 55 years.

The central bank said that the revised rules aim to ensure a more consistent regime for granting of unsecured credit in Singapore.

'The revised rules will allow access to unsecured credit to more individuals who may have occasional genuine borrowing needs,' MAS said on Wednesdsay.

The changes attempt to maintain a balance between allowing responsible borrowing and the Government's social policy of discouraging individuals from spending beyond their means.

'Lenders and borrowers both have a role to play in ensuring that use of unsecured credit and credit cards is responsible, sustainable and within the means of the borrower.'

The changes follow extensive consultation jointly conducted by MAS and the Ministry of Law with the industry and public in 2006 and 2007.

Well, that's nice for Citigroup...and another ream-job for taxpayers.

Citigroup's common equity is currently worth $10 billion. If the US were to convert all $45 billion of its preferred at the current stock price, it should end up with 80% of the company, not 40%.

For the US to convert $45 billion of preferred to common and only get 40% of the company, Citigroup's existing common equity would have to be valued at $65 billion, not $10 billion, and the conversion price would have to be about $10 a share. Or the US would only be able to convert $4 billion of its $45 billion, which wouldn't help Citigroup's tangible equity ratio much.

So is that what Citigroup is trying to do here? Persuade the US goverment to convert to common stock at a price miles above the current trading price, screwing the US taxpayer yet again?

Or does Citigroup have some other secret plan up its sleeve whereby it can take up to $75 billion of debt (preferred stock) off its books and not end up diluting its current shareholders 90%?

The move came just 20 days before the deal to buy the 19-unit condo was due to have been completed on Feb 24, the condo's sales committee said yesterday. The developer, wholly owned by one shareholder, will have to forfeit its 5 per cent deposit of $2.2 million.

'This really feels like a stab in the back. Where is the good faith?' said one owner, also a sales committee member, who declined to be named.

The decision came despite a protracted legal battle in which Jewel fought for the right to buy the site.

The developer outlined its decision in a letter to the lawyer involved in the proposed sale.

Three sale committee members told The Straits Times they felt let down by the developer, as they regarded the firm as a partner in a deal that they had robustly defended against all challenges, believing it was a reputable property developer.

Jewel 1, which was registered in 2006, has only one shareholder and director - Mr Cheong Sim Lam. He was not available for comment.

Mr Cheong's family owns Hong Fok Realty, and he is the uncle of SC Global chief Simon Cheong.

He had agreed to buy Cairnhill Heights in May 2007, at the height of the property boom and amid a frenzy of collective sale deals.

The Strata Titles Board granted the sale in March last year. An objector at Cairnhill Heights then took the case to the High Court but lost the appeal in November.

A sale committee member who wished to remain anonymous said: "Having been on the same side for almost two years now, sometimes fighting shoulder-to-shoulder to secure the sale, the last thing you would have expected is for your contracting party to turn around and leave you in the lurch."

The sale committee said it has reserved all options in terms of possible legal recourse.

Owners of the 19 units will get their share of the forfeited deposit, after deducting for expenses, which are still being calculated.

If the sale had gone through, each owner would have received $1.97 million to $2.5 million, apart from the sole penthouse owner, who would have pocketed $5.5 million.

About half of the owners have rented out their units. One of the owners lives there but also own properties elsewhere in Singapore.

At least one owner is believed to have already bought a replacement property - assuming the full sale price would soon be paid - and is now stuck with two homes.

One owner, businessman Georg Mechtler, said: "We felt aggrieved, having committed for more than two years to sell this property while the market kept climbing. Now, we have missed all our selling opportunities of this cycle. And the buyer only forfeits a miserable 5 per cent."

Still, not all owners are upset. One said she is happy that an architectural icon has been preserved. Cairnhill Heights was designed by Singapore- based architect Geoff Malone.

"We should keep evidence of our architectural heritage," she said.

Moses Largado, 23, recalled getting through to the final round of interviews for a trading position with a foreign investment bank last year, in which none of the nine short-listed fresh graduates were hired. 'The bank ended up picking two experienced hires from Hong Kong for the position,' he said.

'Some professionals with two years of experience are more than willing to take a pay cut of 10-15 per cent for an entry level position with the sales and trading desk at that bank,' Mr Largado estimates. Having a specific department in mind has also not made the job search in a tightening market any easier for finance graduates like Mr Largado's coursemate, Wee Tze Yi.

The 24-year-old, who graduated last year, had approached close to 30 institutions, but only for trading or buy-side research positions because those had been his sole areas of interest - only to encounter resounding silence.

Alongside expectations that are lagging reality, some graduates have been somewhat passive about their job search. Frederic Lee, 26, had interned with a Big Four accounting firm and received a favourable appraisal but he received no response when he applied to it for a job. He did not follow up with a call. 'I'd lost the human resources person's number,' he said.

As recently as early last year, finance graduates were expecting an annual starting pay of $110,000 as the industry norm. Such expectations have been dealt a swift and brutal blow with one newly hired entry-level banker whom BT spoke to bemoaning his starting salary of 'only $55,000 a year'.

But such expectations of hefty pay cheques had primarily been fuelled by the global banks, which are themselves now cutting back on hiring and bracing themselves for austere times.

The hiring landscape this year is a bleak one compared to just two years ago. Of the 15 finance graduates BT spoke to, only four had managed to secure jobs.

In 2007, the National University of Singapore reported that close to 100 per cent of its business graduates gained employment within six months of graduation, with 80 per cent getting a job before graduation, according to its Graduate Employment Survey.

Today, in sombre contrast, the school is telling graduating students to brace themselves and moderate salary expectations.

'Although campus recruitment activities are continuing, the pace has slowed slightly. Given the volatility of the current environment, we can expect some recruiters to relook their recruitment plans,' said Joan Tay, the director of career services for the NUS Business School.

Hiring freezes have also adversely affected business students at Nanyang Technological University compared to their accounting faculty brethren.

'78 per cent of our cohort of 700 accountancy students graduating this May have already found jobs, which is quite similar to previous years.

'However, this year's cohort of 500 business students are facing challenges in finding jobs in view of the recession Singapore is experiencing,' said Professor Gillian Yeo, the executive associate dean at NTU'S Nanyang Business School.

Singapore Management University has taken to advising its students not to be choosy about jobs. 'These difficult times are unprecedented, and for this batch of graduating students, it will be a baptism of fire,' said Ruth Chiang, SMU's director of career services.

All three universities have reported that they are working closely with employers to secure jobs for their graduating students.

Some graduates such as Mr Largado and Mr Wee have decided to give the corporate sector a miss altogether.

Together, they have struck out as independent day traders, setting up office in a Tiong Bahru Soho unit. 'What's the point even if I get a job? The bank might retract the offer or fire me one month from now or even close down,' said Mr Wee, who has been trading currency, commodities and equities for the last three years. Starting out with $70,000 in capital, Mr Wee aims to double that sum by the end of the year.

But he admits: 'Even though we've been trading for three years, we are aware that the market has no favourites.'

Before graduates start looking at a Master's degree as a means of deferring their entry into the workforce, they should take heart from the fact that even though firms have cut down on hiring, they have not stopped altogether.

CIMB-GK Securities, a broking house, is in fact looking to increase its headcount of brokers and relationship managers, and will be scouring career seminars for fresh graduates this weekend.

'Fresh graduates will be considered alongside other experienced candidates as long as they possess the right qualifications and attributes for the positions,' said Carol Fong, the chief executive officer of CIMB-GK Securities.

The National University of Singapore (NUS) student was overjoyed when, in September last year, an American bank wrote to say she would be hired as an investment banking officer when she graduates in July this year.

Ms Lim, 23, even made plans to use her first pay cheque for a holiday in Europe. But in December, another letter arrived. 'The letter stated that the bank was freezing its headcount and thus had to withdraw its job offer,' she said.

The Sunday Times learnt that at least three other yet-to-graduate university students share her plight. The cushy bank jobs they thought they had nailed after their internships did not materialise.

The fallout from the global downturn is seeing new graduates - many with high expectations - chasing jobs also being eyed by retrenched experienced workers willing to take a pay cut.

A Sunday Times poll of 100 graduating students from the three local universities - NUS, Nanyang Technological University (NTU) and Singapore Management University (SMU) - found that one in two is 'afraid of graduating this year'. Between May and July, 12,000 of them are expected to be in the job market.

Ms Joan Tay, director of career services at the NUS Business School, said: 'In the light of the current economic downturn, coupled with significant job cuts and hiring freeze around the world, graduating students must brace themselves for a tight job market and moderate their salary expectations.'

Students are already doing so. The poll found one-third of them have changed their plans or expectations over the past year due to the economic gloom.

NTU electrical and electronics engineering student Yeoh Kuan Seong, 23, will not seek a career in engineering as the crisis has badly hit the manufacturing industry. He will start work as a technologist in Deutsche Bank when he graduates in July. Mr Yeoh, at least, has a job waiting for him.

NTU banking and finance student Neo Poh Lin, 25, has sent resumes to at least 10 banks since last September but has not got replies from most of them. 'None of my friends has got a job yet, not even those tipped to get first-class honours,' he said. For now, Mr Neo is looking to take on part-time sales jobs until the economy gets better.

NUS economics student Eric Chen, 25, who hopes to land a job in finance, has been making cold calls for job openings every other day since last November. He has also sent out more than 100 resumes, all to no avail.

'The finance industry now has an influx of professionals aged below 30 who were retrenched from the foreign banks. How can we new graduates compete with them?' he said.

Meanwhile, some of those who are not yet in their final year have 'backup' plans.

Ms Xu Jieyi, 22, a third-year SMU student doing a four-year double degree in accountancy and economics, will graduate in December next year. But she is taking a part-time diploma course in professional make-up artistry. Her parents paid $4,000 for the five-month-long course which started this month.

'Hopefully, this will be the additional source of income after I graduate,' she said.

The three female guests invited to speak on the talkshow agreed that a good amount would be between $4,000 to $5,000. A shocked Quan Yifeng quipped: "No wonder Singaporean men can't get wives."

A local netizen posted this topic in an online forum in May. Till today, the topic has raged on, with many forummers posting their comments and opinions. The thread has accumulated more than 200 responses so far.

Regarding the minimum that a man should earn, a reporter from the Chinese daily posed this question to 20 men and women. Most of them said that having a salary that is good enough to sustain your lifestyle would be sufficient. However, most agreed that $4,000 to $5,000 is a "reasonable amount" if one is thinking of setting up a family.

Without that minimum amount, they reason, it would be difficult for a man to support his wife, let alone think about having children and allowing them to grow up in a comfortable environment.

The men say: "I would say the same too"

>> Mr Su Jun Long, 27, an accountant, earns $2,400 per month. He says: "I am not worried about not finding a wife, especially not a materialistic one. Actually, it is not important how much I earn, but more of how much I spend. However, when I am thirty-plus, I would also hope I am able to earn a minimum of $3,000 and above."

>> Mr Zhang Yi Zheng, 26, an auditor, earns $2,100 per month. He says: "$4,000 to $5,000 is a reasonable amount to expect. But at my age, it is normal to earn only $2000 plus. My girlfriend earns about the same amount as I do."

>> Mr Huang, 30, an IT personnel who earns $2,500 per month, says: "Contentment is key. Money is a factor, but it should not be the main consideration. Having a low income would be a problem too, so a salary of $4,000 to $5,000 is not too much to ask."

The women say: "It is just enough to support a family"

>> Ms Shen Yu Tai, 27, a bank officer, says: "Actually, $2,000 is enough. But it is understandable that women would require their husbands to earn $4,000 to $5,000. After all, we all want to be able to live a comfortable life. That amount is required to start a family as well."

>> Ms Pan, 27, a writer, says: "It is not important how much he earns, but he must be good at saving. The salary ranges for industries differ, so there shouldn't be a specific requirement, as long as he earns above $2,500.

>> Ms Tan, 30, a customer service officer, says: "Realistically, an income of $4,000 to $5,000 should be expected. Generally, as long as you have a degree, and have worked for a few years, you should be able to draw that amount."

At home, the same is also true. Many families, especially Chinese ones, want a son to carry on the family name.

The son is favoured not only for his role in maintaining the roots of the ancestral tree, but also his ability to provide, hopefully, an umbrella for his parents in their old age.

Parents these days are prepared to have smaller families so that they can give their children the best life can offer.

It is not uncommon for some parents to even buy their children a car or a marital home. Call these actions by whatever name you want, but it all boils down to two fundamental reasons: kiasuism and over-pampering.

The hope is that their children will take care of them or provide them with a roof over their heads when they are old or sick.

However, there are many cases where grown-up children regard looking after parents and parents- in-law as a cost and a liability.

The most popular option these days is to send the parents to an old-age home, where they remain for the rest of their days.

Usually, the more well-to-do the family is, the more commonly this option is taken. This is because it doesn't come cheap.

The reasons (or excuses) are various: Everyone is working, there's no one to take care of them, the house is too small, the children are growing up and there are not enough rooms. Or: Why me, when there are other sons?

No wonder nursing homes are doing so well. Families are passing the buck to others just because they can afford to pay.

Many residents in old folk's homes have not had a single visitor in weeks, months or even years after their admission.

Imagine the loneliness of aged parents as they face four walls, with no one to talk to. Being immobile, it's worse than serving a jail sentence.

The reality of life in a nursing homes is eat, sleep and wait for death.

Interestingly enough, sending parents away to nursing homes does not contravene the three-generation HDB concept (as the aged still keep the same registered address).

Dependants can still pocket an annual government grant given to those who share the same address as their aged parents.

Those who dump their parents in homes ought to realise that they will eventually meet the same fate. The day of reckoning will come when their own children follow their footsteps and let them have a taste of their own bitter medicine.

Bosses and recruitment companies are pleasantly surprised by the change they have noted in their youngest workers. Many have lowered their pay expectations, are shouldering more responsibilities to help cut costs, and even putting their firm's needs before their own.

Mr Colin Ng, 26, an IT graduate from Glasgow University, has been working as an intern at a software firm for three months for just $1,200 a month, in the hopes of being offered a permanent job.

'When I went for the interview, the boss wasn't sure I could do the job. So I offered to be an intern for three months,' he said. 'So far, so good. I am hoping to land the job eventually.'

Besides programming software, he has also been putting in extra hours making pitches to potential clients in the hope of landing a big contract for the company.

He is typical of Gen Y workers - born between 1977 and 1999 - known for being technologically-savvy, self-assured and able to multi-task, and who have invaded the workplace in recent years.

Gen Y numbers close to 400,000 persons aged 16 to 32 in the workforce, holding positions from interns to middle managers.

Figures released for the third quarter of last year showed that Singapore had some 17,300 jobless young people under 30. According to the Manpower Ministry they made up the largest group - about 31 per cent - of an estimated 55,800 Singaporeans who were out of work. At 4.1 per cent, the unemployment rate of this group was higher than the national average of 2.8 per cent. Analysts predict these numbers will spike in the coming months, as more fresh university and polytechnic graduates enter the labour market.

Their salaries are also heading downwards. Human resources firm The GMP Group estimates that the starting pay for fresh graduates will dip by as much as 15 per cent this year.

A year ago, diploma holders in the information technology field commanded monthly salaries of $1,800 to $2,000, while degree holders earned between $2,500 and $2,700. This is expected to fall to between $1,600 and $1,800 for diploma holders, and from $2,000 to $2,300 for degree holders this year, said GMP.

Recruitment agency PeopleWorldwide Consulting's managing director David Leong said the companies he represents are offering lower salaries, about 10 to 15 per cent less. On average, fresh university graduates can expect to earn about $2,000.

According to Gen Y expert Ms Cheryl Liew-Chng, 41, who runs Lifeworkz management consultancy, the recession has been a sobering reality check for this 'entitled generation'.

'They are used to a world in which jobs were plentiful and firms fell over one another to recruit them. Now they are lucky to be invited for an interview,' said Ms Liew-Chng who runs courses on managing Gen Y workers.

Employers agree that they are shortlisting fewer applicants. But they have been pleasantly surprised by those they interviewed.

Mr Stephen Tjoa, executive director of human resources at KPMG said Gen Y applicants used to be 'very specific' about what they wanted to do at the auditing firm. 'Now they leave it to the firm to decide how best it can use them,' he said.

He added that KPMG carried out its annual mass recruitment exercise at the end of last year, but trimmed the number it took in to 200, about 10 to 20 per cent fewer than the previous year.

Not all about play

Computer gaming accessories company, Razer, a favourite employer with Gen Y because its 'fun' work culture allows them to de-stress on pinball machines and the pool table, says its 20-something employees have shown that they are not all about play. About 60 per cent of its 80 staff are under 30 years of age.

When it comes to crunch time, Razer's chief operating officer Soh Yeow Teh noted that his young employees buckle down to work. 'Don't be surprised when you see them stay long after hours just to get things done.'

Indeed, with their resourcefulness and energy, Gen Y workers are proving to be a boon to firms struggling to cut costs and stay afloat in these lean times.

Mr Augustine Sim, 44, who owns a company that sells handicrafts to the Middle East, said he has particularly benefited from Gen Y's technology skills.

'Business has been slow so I enquired about setting up a website. It would have cost me over $10,000 which I don't have.

'Fortunately, two of my young workers offered to do it for me for free. All I had to do was organise a night out for them at Clarke Quay, and pay for food and drinks.'

Gen Y hires are also good value, in that they can juggle multiple portfolios, travel at the drop of a hat and do not mind venturing to new markets to scour for new business.

Said Mr Aaron Lim, 48, who recently started an education business: 'One of my new hires, a business graduate, can set up websites and do marketing and sales. And he is willing to travel to the depths of China or inner Mongolia to look out for new student markets.

'Although times are bad, I am hanging on to him.'

As bosses like Mr Lim indicate, another plus for Gen Y hires is that once they get a job they are more able to hang on to it.

Their skills and the fact that they cost less than older workers means they are more value for money. MOM data shows they account for only 9.2 per cent of those retrenched in the third quarter of last year. Those in the 40s accounted for 37.1 per cent.

But for those out there still on the hunt for jobs, the going has been tough. Many like Ms Teo Wan Choo, 21, a Nanyang Technological University accountancy student, who will complete her course in April, have yet to land a job. Ms Teo is now considering teaching as a Plan B.

'I always thought of giving teaching a shot but later on after a few years in the private sector after I made some good money. But now it looks like I may have to go into teaching direct if nothing else comes along.'

But what happens if despite lowering their expectations they are unable to find a job? The irrepressible Gen Y has many ideas.

Two out of eight youngsters interviewed said they will set up online shops selling accessories such as second-hand handbags and hand-made jewellery.

Some like Ms Claudia Lim, 27, have already plunged into setting up their own businesses. Ms Lim set up a social media consultancy firm, 24seven, to help businesses market themselves through blogs and websites.

'I don't see a downturn, just more opportunities,' says the technology-savvy Ms Lim who holds a business diploma from the poly and a teaching diploma from the National Institute of Education.

Polytechnic business graduate Rosie De Cruz, 20, who has taken a shiatsu massage course at a beauty and spa academy here plans to offer elderly people home massages for $80 an hour.

Ms Liew-Chng is optimistic that such flexibility will help Gen Y ride out the recession better than their predecessors.

However, not all employers agree that their young hires have come to terms with today's harsh market conditions.

Mr Desmond De Costa, 50, who runs a food catering service, rants: 'I had a couple of 22-year-olds quitting on me, because I did not give them the Saturday and Sunday off for them to attend the rave party Zouk Out last month.

'They don't seem to care about holding on to their jobs in these hard times. They need this recession to grow up.'

Banks are still focusing on replenishing capital 'and estimates of the extent of bad assets on their books are still on the upswing,' said Mr Tharman. 'We haven't seen the worst yet.'

Bank losses worldwide from US-originated bad assets may reach US$2.2 trillion, the International Monetary Fund said on Wednesday, more than the US$1.4 trillion it predicted in October. US President Barack Obama's administration and federal regulators are considering setting up a 'bad bank' that would absorb illiquid assets from otherwise healthy financial firms.

Governments across Europe have injected capital into banks to ensure that lending to companies and consumers doesn't freeze up. European Union regulators yesterday approved France's plan to increase its funding for recapitalisation of banks including

BNP Paribas SA and Societe Generale SA to 11 billion euros (S$21.6 billion), from an initial proposal for 10.5 billion euros.

Ireland's government last month said it would invest 2 billion euros in Allied Irish and Bank of Ireland, the country's biggest lenders.

'Foot the bill'

'It's right that governments are focusing on recapitalisation in the West and they're trying their best to incentivise new lending,' Mr Tharman said. 'It's too early to say how successful this will be. Governments have to take more risk, and that means taxpayers have to be willing to foot part of the bill.'

The IMF report released on Wednesday signalled that writedowns and losses at banks totaling US$1.1 trillion so far are only half of what's to come. Losses on that scale would leave banks needing at least US$500 billion in fresh capital to restore confidence in their balance sheets, the fund said.

Singapore's leaders have defended the performance of the city's state-owned investment companies after a plunge in the value of their stakes in Citigroup, Merrill Lynch and other global banks.

GIC, which manages the country's reserves, invested about $18 billion in UBS and Citigroup since December 2007. Temasek, which has a $130 billion portfolio, increased investments in Merrill Lynch and Barclays Plc as the credit market collapsed in 2007 and 2008.

Temasek was the biggest shareholder in Merrill Lynch before the securities firm was taken over by Bank of America Corp. It is also the largest shareholder of banks including London-based Standard Chartered Plc and Singapore's DBS Group Holdings Ltd, and has holdings in India's ICICI Bank and other lenders in Indonesia, South Korea and Pakistan.

Temasek and GIC remain 'well diversified' enough in their portfolios to offer the long-term returns the government seeks, Mr Tharman said.

'We would be very worried if global banks comprise a large proportion of the portfolios of GIC or Temasek, or for that matter, any of the highly vulnerable industries globally,' the minister said. 'But these are diversified portfolios.'

Temasek and GIC have performed 'credibly by international standards,' he said. Temasek had an average 18 per cent annual return on investment since its inception in 1974. GIC said in September that annual returns in the past 20 years averaged 7.8 per cent in US dollar terms, compared with about 6 per cent for the MSCI World Index.

GIC last year also said it's boosting investments in emerging markets, private equity and other asset classes to raise returns after cutting back stocks and holdings in developed nations.

'I'm comfortable with the actions both Temasek and GIC have taken early in this crisis to reduce risk, to move into more liquid asset allocation and to prepare for opportunities in this downturn,' Mr Shanmugaratnam said. 'We've got to make sure we maintain that record of prudent investments for the portfolio as a whole, diversifying risks, and being prepared for crises from time to time.'

Companies in export-dependent Singapore are firing workers as demand for goods and services ebb. More than 10,000 people were retrenched last year and a worsening economy may result in job losses tripling in 2009, reaching numbers not seen since the Asian financial crisis a decade ago, the government said.

"The contraction in exports and output and consolidation in financial and business services could lead to sizeable job losses, which, in turn, may drive as many as 200,000 foreigners and permanent residents out of Singapore," the economists said. "These levels of job losses and population decline would be unprecedented."

Singapore's economy may shrink 2.8 percent this year, Credit Suisse predicts, making it the Southeast Asian nation's worst annual contraction in its 43-year history. The government says gross domestic product may decline as much as 2 percent.

Last week, the National Wages Council, which represents government, employers and union groups, advised companies affected by the deepening economic slump to freeze or cut pay rather than fire workers.

Fewer Births

About 30,000 workers were retrenched in 1998 and some 26,000 lost their jobs in the 2001 downturn, acting Minister for Manpower Gan Kim Yong said yesterday.

Immigration is a key component of Singapore's population strategy, as incentives offered since 1987 to arrest a declining birth rate by offering tax breaks, subsidies and cash bonuses failed. Singapore, a quarter the size of Rhode Island, has no natural resources and the government relies on the skills of its populace to generate economic growth.

The nation's population jumped 17.6 percent in the five years to June 2008, and foreigners made up three-quarters of the increase, the Credit Suisse report said. Foreigners and permanent residents filled 61 percent, or 484,700, of the 796,000 jobs created between 2004 and the third quarter of 2008, the analysts estimated.

Singapore's employers added more than 435,000 workers to their payrolls in the seven quarters to September 2008, according to the Ministry of Manpower.

'Harsh Assumptions'

"As harsh as our assumptions may seem, they only imply that the economy gives up all of the jobs it created in 2008 and a portion of the new jobs in 2007," the economists wrote.

About 160,000 positions in the services industry may be lost, while manufacturers may fire 100,000 workers, Credit Suisse predicts. The construction industry may cut 40,000 workers, it said.

"The potential drop in employment and population would have far-reaching implications for the economy," wrote Credit Suisse analysts Sean Quek and Kwee Hong Ching. "Private consumption could contract in both 2009 and 2010."

The unemployment rate, at 2.2 percent as of September 2008, may rise to 5.6 percent by 2010, the highest in more than two decades, they said.

Job cuts rose "significantly" last quarter, and both unemployment and layoffs are expected to be "substantially higher" in 2009, the National Wages Council said last week.

'The issue which the Prime Minister and the Minister of Finance are now thinking over, is whether we should go to the President and ask him for approval to use the reserves for extraordinary measures,' he told reporters after giving out $100 hongbaos and goodies to the low income in his Marine Parade constituency.

But he also cautioned: 'It's a difficult decision because once you do that, you may open the reserves for future demands, which may not justify the use of reserves.''

On Friday, Prime Minister Lee Hsien Loong had said the Budget will run into a deficit this year and, if necessary, the Government will dig into the reserves.

He told reporters after a lunch with unionists: 'The Government's job is not to do everything which is asked for but to look to see which are the items which will be most effective and then how do I raise the money which I need to fund all the things which I need to do, either from the Budget revenues this year or from the reserves which we have accumulated."

A move to tap the sacrosanct reserves would be one more sign of how seriously the Government views the downturn.

Last year, it had already modified the rules to allow it to spend a larger chunk of the investment returns from the reserves.

But in 1999, in the aftermath of the Asian financial crisis, the Government had shied away from going to the reserves for funds, even in the face of a $5 billion Budget deficit. Mr Goh was the PM then.

Yesterday, however, he pointed out that a 'muscular response' in the upcoming Budget is needed as these are exceptional times - and the key issue is to save jobs.

'There must be exceptional measures for exceptional times,' he said.

He gave a sampling of the dire economic news coming in, noting the sharp dive in export figures last month. Singapore's exports plunged 21 per cent in December, the biggest fall in almost seven years.

'The weather is so bad, and we've always said the reserves are for a rainy day. If this is not a rainy day, I don't know what is a rainy day,' he said.

Optimists - and these ranks would be heavily populated by brokers and investment bankers - might believe that with so much money being flung at the problem (latest estimates is that the US rescue bill is closing in on US$1 trillion and climbing) things must improve, maybe even as early as the second half of 2009. If so, then now is the time to buy.

Pessimists would counter that when a bubble economy collapses, it usually enters a long period of stagnation and possibly depression. (We are reminded here of Ronald Reagen's famous declaration that 'a recession is when your neighbour loses his job; a depression is when you lose your job').

A case in point is Japan, whose property bubble burst in 1990, leading to a stock market crash. Its government immediately cut interest rates to zero (as has the US Federal Reserve now) and expanded its budget deficit sharply (as the US government already has). These actions did manage to avoid an economic collapse but there has been no recovery - Japan has had five recessions in 18 years and the latest looks like being the worst. After repeated failed bear rallies, its stock market is still more than 70 per cent down from its all-time high.

A neutral in the meantime, might say the jury is still out on whether simple money printing and expanding the budget deficit will work because a heavily indebted consumer who has no job cannot help spend the economy out of its mess. As such, scepticism should be the order of the day - until clear signs to the contrary emerge.

Optimists might argue that with so much volatility, it's best that investors shorten their horizons and if so, the impending inauguration of President Obama in the US on Tuesday, the Singapore government's impending Budget announcement on Thursday and Chinese New Year soon after might mean now is a good time to buy because there could be a 'Chinese New Year rally'.

Pessimists would say that any such rally would be largely through short-covering and would be temporary at best, and that if one does occur, investors should continue to sell into strength since by the government's own admission, conditions have actually worsened since the start of the year.

A neutral would reply that cash is king and nobody knows where the bottom is but they would note that all urgings to buy have come from brokers and investment bankers who were painfully wrong last year and should therefore be afforded minimal credibility in the investment advice stakes.

Optimists would reply that 15 months into the bear market may be sufficiently long for the market to fully discount all the bad news, so present prices probably already reflect the worst.

Pessimists would point out that prices are only being kept afloat by the US government's bailout money and that if these efforts fail, the downside can be massive. US stocks are only at their lowest in 10 years, which does not gel with an economy mired in the worst depression in 70 years.

A neutral would observe that the market has demonstrated huge inefficiencies over the past few years, failing to recognise risks when they were staring everyone in the face and instead believing the now-discredited mantra that 'this time is different'.

As a result, the smart thing to do is stay away from stocks until the ranks of optimists thin significantly, the ranks of pessimists swell appreciably and above all, much clearer signs of capitulation appear - especially in the US, because it can only be a matter of time before this occurs.

Investors — from individuals to the Sarasota YMCA Foundation — in the funds branded Viking, Valhalla and Scoop were stunned this week to learn they may be victims in what could become the largest investment swindle in Southwest Florida history.

Despite the carnage on Wall Street last year, investors had been told their investments earned more than 8 percent as of November.

Some are already calling it a "mini-Madoff," after accused investment scammer Bernard Madoff of New York, who has been accused of creating an alleged $50 billion Ponzi scheme that yielded similarly large percentage returns.

"I feel abused. I feel beaten. I don't know who to believe," said Dr. Brad Lerner, who expects to lose nearly $730,000 in an IRA fund with Nadel and Moody.

Neil V. Moody, the president of Viking Management, declined to respond to interview requests.

In a statement issued Thursday to investors, Moody confirmed the funds appear depleted.

"Unfortunately, just yesterday afternoon we became aware of an extremely serious situation suggesting that the funds may have virtually no remaining value," Moody wrote.

Moody, who lives part time in Evergreen, Colo., has told several investors interviewed by the Herald-Tribune the funds value totaled $350 million. He said he has contacted the U.S. Securities and Exchange Commission and "all appropriate authorities" to report the situation.

Moody is telling clients that Nadel did all the fund trading, and that Moody had no idea anything was wrong until this week.

Nadel, 75, and Moody, 70, operated under the name Scoop Management Inc. in a double storefront at 1816 Main St., across from the Bank of America building.

Management appeared in a state of turmoil. Peg Nadel and son Geoff Quisenberry said they could not comment on the size of the company's assets under management, the number of clients, how much has been lost, or even whether it is accurate to call them a hedge fund operator.

"The way I want to be represented is we are totally open and cooperative with all our clients and the authorities, and that includes the SEC," Peg Nadel said. "We have nothing to hide. But until our counsel has a statement prepared for us to make public, we cannot comment on what is happening here."

She and Quisenberry both denied reports that employees were emptying out the office.

The Nadels were known for their civic activities, serving on boards and donating money.

Habitat For Humanity, Jewish Family & Children's Services and Girls Inc. all received cash gifts and pledges from the couple in recent years. None had any money invested in the hedge funds.

"We're very fortunate in that way," said Rose Chapman, president of Jewish Family & Children's Services. Moody was co-chair of the organization's capital campaign.

"We've received gifts from them over the years, but they were all cash," said Stephanie Faltz, Girls Inc.'s executive director. "We had no funds with them. The Nadels have been very generous. This makes me very, very sad."

At Habitat For Humanity, the Nadels were the home building charity's largest donors. Last year, at the group's "Hammers & Hope" fundraiser, Peg Nadel pledged an equal amount if Habitat raised $250,000.

The Nadels also own the Venice Jet Center, which has been at the center of controversy in Venice over its efforts to expand.

Investors interviewed by the Herald-Tribune said they realized something was wrong when they failed to receive their December statements, or when they did not receive requested distributions.

Scoop could not meet a year-end demand for $50 million in withdrawals from investors, Lerner said.

He said he invested $500,000 in the Viking IRA Fund three years ago, and through November it had grown to $729,844. The fund managers claimed the fund had earned 8.56 percent in 2008, down only in October, during a year when Wall Street suffered catastrophic losses.

"I had no reason to believe it wasn't real," he said.

Moody contacted him Thursday to say that his money was gone and that Nadel had disappeared.

Lerner, a physician specializing in internal medicine, was one of several investors who filed reports Friday with the Sarasota Police Department.

Another local investor, who requested anonymity, said she had asked for a year-end distribution but was stalled for a few days. Moody on Thursday admitted to her that "Art Nadel was missing with all the money." She had invested with the firm for 10 years.

And it is not just individual investors. Local foundations also appear damaged.

Until Thursday, the YMCA Foundation of Sarasota believed that $1.1 million, or 13 percent of its total assets, was generating returns of at least 10 percent per year in the Valhalla Management L.L.C. fund.

Moody, a director of the YMCA and first vice chair, informed YMCA president Karin Gustafson on Thursday that the money is gone. He resigned from the board at the same time, she said.

Moody, also well known in social and civic swirls, made an initial donation in January 2005 and bumped the total up by $1 million starting in 2007 and into 2008, Gustafson said.

"Neil made a significant gift but asked that it be invested at Valhalla," she said.

"With Neil's fund, because it was outside our investment guidelines, he did a personal guarantee of 10 percent," she said. In other words, if the fund did not generate at least 10 percent per year, Moody promised to make up the difference.

The YMCA received regular reports from Scoop Management, with the last showing a November balance of $1,188,000.

Gustafson could not describe how the money was invested.

Hedge funds are basically private investment pools for wealthy, sophisticated investors. Many are organized as partnerships with a general partner managing the fund's portfolio and making investment decisions.

Minimum investments can be high — $100,000 is not unusual — and the funds can be risky. Hedge funds typically target a specific range of performance and attempt to produce targeted returns regardless of the underlying trends of the stock market.

In a 2003 report, Sarasota-based The Wall Street Digest lauded Nadel's and Moody's experience, especially Nadel's "black box" computer trading program.

Some clients have contacted the Williams Parker law firm about their investments.

Lerner says he hopes there will be some concerted effort to recoup investors' money.

"I'm not optimistic at all," he said.

John Hielscher can be reached at 361-4875.

Those companies doing well are, however, urged to reward their workers with 'moderate' wage increases which should not be built into fixed wages but given as variable payments. Similarly, wage cuts should start with variable components bonuses, and management should lead by example, said the council yesterday.

However, it is not in favour of any cut in the CPF contribution rates.

The recommendations of the 13-member council are a revision of the guidelines it had announced last May when economic conditions were brighter.

The Government has accepted the new guidelines, saying they were 'timely' to cope with the financial crisis.

Though not mandatory, the recommendations are followed by most companies in Singapore.

In announcing the changes, NWC's chairman, Professor Lim Pin, said they were enough for now. The council, with representatives from the Government, employer groups and unions, will meet again in April or May, when it holds its usual annual meeting.

'Let's hope nothing too drastic happens between now and then,' said Prof Lim, indicating that more drastic measures will be taken if necessary.

The latest meeting, the second in eight months, reflects the bleak state of the economy.

It is only the third time in NWC's 37-year history that guidelines were revised way before the annual deadline. It did so in 1998 during the Asian financial crisis and again in 2001, after the Sept 11 attacks on the United States.

The council said yesterday that retrenchments had started to rise 'significantly' in the fourth quarter of last year.

The extent of the increase will be known by this month's end when the Manpower Ministry gives the numbers.

Asked if the new guidelines will stave off retrenchments after Chinese New Year, council member Stephen Lee from the Singapore National Employers' Federation (SNEF) said: 'It can't prevent, but it can moderate retrenchments.'

The guidelines also included a call for companies to tap on the new Government-sponsored training programme, which gives employers more money to retrain, rather than retrench, workers.

So far, 170 companies have committed about 8,000 workers for the Skills Programme for Upgrading and Resilience or Spur. Another 2,000 jobless Singaporeans have also signed up.

The NWC also reminded employers to follow the tripartite guidelines on managing excess workers, which means considering other cost-cutting options like a shorter work week before cutting staff.

Council member Heng Chee How from NTUC said more than 18,000 workers from unionised companies have been put on a shorter work week since November.

Standard Chartered Bank economist Alvin Liew describes the guidelines as 'logical'. He expects the Budget next Thursday to further flesh out the suggestions by cutting business costs .

Other analysts, like Mr Leong Wai Ho from Barclays Capital, foresee more salary reductions, even a cut in employers' CPF contribution rate later should the recession persists.

Industry groups such as the Singapore Chinese Chamber of Commerce and Industry and the Singapore Business Federation welcomed the recommendations, in particular, the call for Government to reduce non-wage costs, such as rent and utilities.

Also backing the guidelines, SNEF noted that business costs rose 8.9 per cent in the first nine months of last year, compared to 2 per cent for the whole of 2007.

NTUC on its part called on companies not to let up on efforts to retain older workers, and improve employment terms for low-wage and contract workers.

Acting Manpower Minister Gan Kim Yong, at a separate event, said: 'I hope companies will take NWC's advice seriously and work with us to manage this downturn. If we can, we will be able to cut cost and save more jobs.'

The gloomier state of the economy was also affirmed at his meetings with businessmen and unionists since last week, as he met 30 of them on four separate days.

Mr Lee told reporters that one company had built up six months' worth of goods with no buyers. At the PSA container terminals, cranes are lying idle. 'It's a situation which is already gloomier now than it was on New Year,' he said after a lunch meeting with unionists.

The day after New Year, the Government revised downwards this year's growth forecast to between -2 and 1 per cent, from November's projection of between -1 and 2 per cent.

In the past couple of weeks, growth and trade numbers in Asia and elsewhere have fallen very drastically, Mr Lee said.

Yesterday, Singapore reported that its non-oil exports fell by 21 per cent last month compared to the same month a year earlier.

Most economists interviewed expect Singapore's economy to contract by 3 per cent. Said CIMB-GK economist Song Seng Wun, who predicts a worst case scenario of between -2 and -5 per cent: 'We should be more aggressive in providing support for the local economy.'

The business and union leaders who met Mr Lee suggested reducing business costs such as property tax, and the rental of space from HDB and JTC Corporation.

Others want the Government's $600 million Skills Programme for Upgrading and Resilience to take in more professionals and middle managers. Unionists also urged Mr Lee to help middle-income workers, who are hit by the turmoil too.

The Prime Minister said the Government would need to balance the various suggestions, adding that the Budget will run into a deficit this year and if necessary, the Government will dig into the reserves.

'The Government's job is not to do everything which is asked for but to look to see which are the items which will be most effective and then how do I raise the money which I need to fund all the things which I need to do, either from the Budget revenues this year or from the reserves which we have accumulated.'

He also said that Singapore can make the necessary adjustments, 'but what happens after that depends on what happens around the world'.

Mr Lee declined to give specifics of the Budget but indicated it would not follow that of other countries in spending money to boost demand because of Singapore's open economy.

'People will spend it once and then most of the money will leak overseas and that's the end of the warm feeling.'

The Budget focus will be to help companies stay afloat and save jobs, so that workers can look after their families throughout the downturn, he said.

It will also deal with the longer-term concerns of competitiveness and creating new capabilities, he added.

This is important because employers, particularly multinational companies that have weathered previous crises, see long-term opportunities in Asia, said the Prime Minister.

They also think Singapore is a good springboard for exploiting these opportunities when conditions improve, he added.

One lunch participant, Mr Daniel McHugh, chief executive officer of express cargo carrier DHL Express (Asia Pacific), cited the government efforts to train and re-train workers as one reason for his confidence in Singapore. 'I've been in Asia for 25 years and I've not seen this level of government commitment to working with MNCs on people development.'

Mr Lee also gave his reason for holding his lunch meetings, as other ministers and government agencies have also sought views from businesses, unionists, grassroots leaders and members of the public on the Budget.

He said he wanted to have his own feel of the ground. 'I usually have a sounding of a range of views during the year and particularly before Budget. But this time I'm doing more because it's a very critical moment...it's not an ordinary Budget.'

Despite the gloomy picture, Mr Lee is heartened that unionists and bosses share similar views on the need to work together to keep jobs and companies viable.

'It's a tremendous strength for us, in a situation like this, which not many other countries would be able to do,' he said.

Singapore is asking its citizens, the world's third- wealthiest adjusted for purchasing power, to be prudent as analysts predict the worst economic slump in the nation's 43- year history. In speeches, pamphlets and ads, the government is advising people to switch to cheaper frozen meats, take shorter showers and skip the top-of-the-line mobile phone.

The island's strategy contrasts with that of other countries such as Japan and Taiwan, which are trying to boost consumer spending to spur economic growth as exports falter. Singapore, whose 4.8 million population is one of Asia's smallest, doesn't have a big enough home market to make up for falling sales overseas, so officials "are not even going to try" to tell people to spend more, says Vishnu Varathan, an economist at Forecast Singapore Pte.

"There's no way the domestic economy can make up for the slack in the external sector," he says. The message "is to bear with pay cuts and live frugally."

Dwindling Incomes

The government is preparing people for dwindling incomes as the nation's fourth recession in a decade forces companies including lender DBS Group Holdings Ltd., manufacturer Stats Chippac Ltd. and state-owned investment company Temasek Holdings Pte. to fire workers or trim salaries. Singapore last year unveiled more than S$5.4 billion in cash payouts, utility rebates and special funds, or S$1,700 for each of the nation's 3.2 million citizens, to help the poor cope with rising food and energy prices.

Officials say people also need to help themselves during the economic crisis. If everyone depends on the government, "we'll weaken ourselves as a society," Prime Minister Lee Hsien Loong said on Jan. 11, according to the island's main English newspaper, the Straits Times. "We'll cultivate a sense of reliance."

The World Bank predicts Singapore's $161 billion economy will be East Asia's worst performer this year. The government forecasts it may shrink as much as 2 percent, after expanding 1.5 percent in 2008 and 7.7 percent in 2007. Kit Wei Zheng, an economist at Citigroup Inc. in Singapore, says the contraction might be as much as 2.8 percent -- the most severe since Singapore gained independence in 1965.

Rising Unemployment

The unemployment rate may more than double to 5 percent from 2.2 percent in September 2008, says Leong Wai Ho, a regional economist at Barclays Capital in Singapore. More than 30,000 jobs may be lost, he says, after about 400,000 new positions were created in the past two years.

That could boost the default rate on mortgages for government-built apartments, which house 84 percent of Singaporeans. The rate has risen to 8 percent from 5 percent in 2003.

Governments elsewhere in Asia are encouraging their more- sizeable populations to spend to counter the deepening global recession. Taiwan extended the New Year's holiday an extra day and is scheduled to distribute NT$3,600 ($108) shopping vouchers to citizens on Jan. 18. Japanese Prime Minister Taro Aso has pledged to give households 2 trillion yen ($23 billion) in handouts.

Private Consumption

That may not work for Singapore, where private consumption accounted for 38 percent of gross domestic product in 2006, compared with more than half in Australia, Hong Kong, South Korea and Japan, according to the World Bank.

Singapore's leaders have traditionally preached restraint amid economic difficulties. In 2001, when the economy contracted 2.2 percent, the government refused to cap electricity prices and instead gave utility rebates to help the poor and encourage people to "save and not over-consume," then-Prime Minister Goh Chok Tong said in an August 2001 speech.

The government's latest campaign began last year when prices of food essentials including rice and cooking oil surged. As inflation soared to a 26-year high of 7.5 percent, Prime Minister Lee urged people to switch to frozen meats and in-house brands of supermarket products, which are typically cheaper.

'Healthier' Vegetables

The national power company ran television ads telling consumers to set air conditioners several degrees higher and use energy-efficient bulbs to combat rate increases of about 42 percent. A government-run community-development council distributed a brochure to homes in Singapore's most-populous district, suggesting people use less water and substitute meat with "cheaper and healthier" vegetables.

MoneySense, a national financial-education program run by the central bank, sponsored an advertisement in the Straits Times last month featuring a cartoon of a man showing off his new cell phone, then skipping lunch and subsisting on water because he had no money left.

Not everyone is getting the message. Alicia Leong, 29, received a 32-page booklet in her mailbox in December with tips on saving money. The next day, she spent S$1,200 on new clothes and a handbag, charging them to two of her seven credit cards.

"I still have a job, so I don't see the need to tighten my belt," says Leong, a teacher at a local high school. "I'll probably stop when my credit cards are maxed out."

Credit-Card Debt

Singaporeans rolled over a record S$3.5 billion in credit- card debt last November, about 18 percent higher than the year before.

Other people are taking the advice to heart. Jack Oh lost his job as an electrician when his employer went out of business in October. The father of three school-age children now drives a taxi and says he's cutting back on the Lunar New Year celebration, which begins Jan. 25.

"Last year, we went to a restaurant for the reunion dinner with my family, parents and siblings and spent over S$1,500," says Oh, 44. "This year, we're doing it at home, and I told my wife to get the cheaper abalone."

Almost eight in 10 Singaporeans believe unemployment will rise this year as the country's economy declines, with gross domestic product expected to be between minus 2 per cent and 1 per cent.

The global poll was conducted between October and December last year, with 45,700 people in 46 countries interviewed.

In Singapore, where 1,000 people were polled, expectations seem bleaker.

Almost two in three Singaporeans say this year will be worse for them than last year, compared with a global average of 35 per cent who feel the same way.

Commenting on the results, Mr Wage Garland, managing director of TNS in Singapore and Hong Kong, said such pessimism follows the bad news and views expressed by leaders and business organisations which are carried in the media.

'Media reports of these types of forecasts, the financial difficulties of several major local retailers, falling property prices and the layoffs already taking place in some companies have made people realise that the global economic turmoil is having an impact on Singapore,' he said.

But what is surprising, he added, is that it has yet to undermine confidence in their own future. Despite the gloomy forecast, seven in 10 working Singaporeans are confident of keeping their jobs, even though most believe more people will be jobless.

But should they lose their jobs, almost eight in 10 Singaporeans fear it would take a long time to find a new one. Compared with people elsewhere, Singaporeans are more pessimistic, with the global figure standing at 54 per cent.

"She said, 'I hope this is a rumor, but I've just heard Bernie Madoff's been arrested,' " Penney recalls. "My other phone rang; it was my son. And he said, 'Mom, sit down.' He said, 'Bernie Madoff's been arrested.' And I said, 'For what?' And he said, 'He's a crook.' "

Madoff's alleged $50 billion Ponzi scheme disrupted a fragile financial system, affecting hedge funds and well-heeled investors on Wall Street, Florida and Europe. In a Ponzi scheme, money from new investors is used to pay off early investors to create the appearance of legitimate returns.

Conservative with her money, Penney says she has been working and saving since she was a teenager. She admits that her biggest fear was losing everything and "becoming a bag lady." About a decade ago, when Penney was in her late 40s, she shared her fears with a good friend, who steered her to Madoff, where she thought her money would always be safe.

Best known for the 1982 best-seller "How to Make Love to a Man" and as a former editor of Self magazine, Penney and her friend Evelyn Lauder were the first to use pink ribbons as a symbol for breast cancer awareness. Every success along the way meant more money, which was eventually invested with Madoff. She earned so much money that she was no longer writing and editing but living her dream as an artist.

Sitting in her artist's studio in the SoHo area of New York, she recently said she will start writing again to pay the bills. And she has a few choice words about Madoff, who remains under house arrest in his Manhattan penthouse apartment, where he lives with his wife while the case proceeds.

"Repulsive is mild. Loathsome. It's a visceral feeling. This is not humanity; this is not a human being. This is, again, it's a sociopath," Penney says. "I'm sincerely, and this is the understatement of the year, appalled that this man is not in prison."

But that could change soon if a judge decides to revoke Madoff's bail. In a court filing Thursday, the U.S. Justice Department accused Madoff of having signed about 100 checks -- worth a total of $173 million -- that were "ready to be sent out" before his arrest by the FBI on December 11 on a charge of securities fraud. Madoff investors might have to cough up withdrawals »

Prosecutors said the checks violate his $10 million bail agreement and said it was an attempt to prevent his alleged victims from recovering their losses. If convicted of the charges against him, Madoff, 70, could spend up to 20 years in prison and face a $5 million fine.

On the advice of her lawyers, Penney is not saying how much money she lost. She's not penniless, she says. She has a checking account that will last a few months, a West Palm Beach cottage, a Manhattan apartment and a "beach shack" in Wainscott, Long Island. Over the past 40 years, she earned and paid for all of it herself.

Penney is not asking anyone to feel sorry for her, especially after the acid-response to her first-hand account of her financial woes in a blog called "The Bag Lady Papers" on TheDailyBeast.com. In the blog, she talks about selling the cottage and possibly more real estate and taking her first subway ride in 30 years. She's even considered selling some of her expensive jewelry to pay the bills.

Some readers blasted her as a privileged New York princess. They told her to get a job. Others said they didn't feel sorry for her. Penney says she was surprised by the "vitriol."

"I've never been given a dollar. I never took alimony. I never inherited any money. So, sure, well, who else earned it? Me," Penney says.

Today, she says she has been "Madoffed."

When the phone rang last month with the news about Madoff's arrest, Penney was making a cheese soufflé. Ever the writer, she uses the soufflé as a metaphor. "Everything was rising. We were all rising. The housing market was rising. Bernie Madoff's money, people like me, my money was making 9, 10 percent," Penney says. "There was this incredible lift of the economic picture. And I think that the crash of the stock market and the crash of Bernie Madoff together are really emblematic that the system is the culprit. Madoff is emblematic of the system, but there's something very wrong with the system."

And just like the investments, Penney says, the soufflé fell, too.

Chief executive Lucas Chow told staff in a circular yesterday that common leave days will be introduced, shorter work weeks implemented, new curbs placed on holiday entitlements and some benefits reduced.

The belt-tightening steps are being made to avoid layoffs, said the company which employs around 2,500 people.

They also come on top of earlier steps that cut some performance bonuses and capped travel and administration expenses.

Mr Chow underlined yesterday just how serious the situation was: 'Going into the new fiscal year, we have to go even further in order to keep the company afloat. These are unusual times calling for unusual measures.'

One of the most dramatic of these was that all staff, except those in round-the-clock services like news or radio, must take seven common leave days - with pay - over the next 12 months. This will allow some operations to be halted, although Mr Chow did not specify which ones.

The first leave break starts with the three days right after the Chinese New Year holiday.

The broadcaster, which runs CNA and the free newspaper Today, will also implement a four-day work week every other week. This will apply to all employees.

These so-called 'MediaCorp days off' will start in April and will mean a total of 26 unpaid days off in a 12-month period. It will amount to a 10 per cent cut in MediaCorp's annual wage bill, a report on the CNA website said. The report added the alternate short week and common leave will be scheduled around public holidays and school vacations.

This will mean breaks for some staff lasting up to a week. The days have already been selected and staff have been informed.

Employees were surprised by the announcement. One said: 'Are things really that bad that they have to resort to this?'

Another added: 'I'm thankful to still have a job, but this means that effectively I will get only 11 months' pay.'

From April onwards, employees will also be required to clear all their annual leave and will no longer be allowed to carry holiday entitlements forward to the next year.

A new benefit scheme started last year that gave staff $100 each has been suspended indefinitely.

Mr Chow, who will host an open forum at MediaCorp next Monday afternoon, said in his circular that the financial year ending March 31, while 'largely on track in the first half, will be hit by the weakening economy'.

The firm had revenue of $530 million for the year ended March 31, 2008 with profit of $52 million.

'MediaCorp relies heavily on advertising revenue, which is extremely sensitive to the overall economic climate,' stated Mr Chow. 'As a result, our financial performance in the third quarter has been affected and prospects look weak in the months ahead.

'Manpower salaries form a big part of our operating expense, and we have no choice but to manage this cost element.' He said he remains committed to saving jobs, and has consulted union leaders, management and the chairman.

Mr Ang Wah Lai, president of the Singapore Union of Broadcasting Employees, told CNA: 'Our employees understand it's a necessary step to save jobs.'

Labour chief Lim Swee Say said the consultation between the union and the company will 'strengthen trust and build confidence which is especially critical during this downturn'.

She had been looking for a job in the hotel industry since graduating from the National University of Singapore (NUS) in June last year.

In December, after being turned down repeatedly by hotels, she enrolled in a course for a certificate in hotel services. She did so in the hope that when she finishes the course next month, she will be able to get a job in the hotel industry.

'Right now, it is okay for me to start at the bottom and earn $1,500, $1,000 even. Some grads may disagree but in the long run, I am sure this move will pay off as I move up the ladder,' she says.

The Pensions at a Glance study, which also involved the World Bank, found that Singapore's average gross replacement rate - the value of the pension as a percentage of earnings when working - is just 13.1 per cent.

Taipei has the highest gross replacement rate of 70 per cent, the report said.

'This means that the gross pension income for average earners in Taipei is over two-thirds of their previous earnings level, whereas pensioners in Singapore receive less than one-seventh the amount of their earnings,' says the study.

Singapore's pension is provided by the Central Provident Fund (CPF).

'The relatively low replacement rate for Singapore is because the calculations only consider the earmarked retirement account,' says the study. 'If an individual were to put the general account towards retirement-income provision as well, then the replacement rate would be 82 per cent.'

It points out that it would be foolish to say that one Singaporean who withdrew from the CPF to buy a house is worse off than another who built up a retirement income and then had to use some of it to pay for housing.

'Nonetheless, there is a risk that older people find themselves asset-rich and income-poor in retirement and facing difficulty in unlocking the value of their housing assets to pay for essentials,' the study says.

Replacement rates - the most familiar indicator for pension analysts - are not the only factor governments are concerned with. They also need to measure the value of the overall pension promise.

'This is measured by the indicator of pension wealth which takes life expectancy into account,' the study says.

Again, Singapore has the lowest measurement - a retiree's pension here is worth just an average 2.2 times their earnings at retirement. The figure for China is 21.2 times - the highest in the region.

The past seven days alone saw a 25 per cent jump in the number - up from 12,000 at the end of the previous week, said the National Trades Unions Congress (NTUC).

This means that about 5 per cent of its 294,000 unionised workers have been affected so far.

The significant uptick in numbers is 'a precursor to retrenchments', said Mrs Josephine Teo, NTUC's assistant secretary-general, at a media briefing on Thursday.

'It's quite realistic to expect that after Chinese New Year, in the first quarter leading to the second, we will see an increase in retrenchments,' she warned.

A total of 3,773 unionised workers were retrenched last year, compared to 2,943 in 2007.

She attributes the recent spike to what she calls 'the Chinese New Year effect' - manufacturing companies deciding to close its factories for a longer period of time during this holiday period.

Some have also given feedback that they have 'no orders to fulfil this year.'

At the same time, the numbers could be an effect of recent guidelines urging companies to manage excess manpower by such ways as shorter work weeks and flexible wages, rather than retrenching.

Mrs Teo revealed that the workers hit so far are typically in export-dependent manufacturing sectors such as electronics or chemical processing. Relatively fewer numbers are seen in the service industry.

For these workers, shorter work weeks and temporary lay-offs - where employers can ask workers to take up to half of their annual leave and pay them half their wages - have translated into pay cuts ranging from 10 to to 50 per cent.

With more workers facing such a predicament, one danger is that family ties will come under strain.

NTUC, together with the National Family Council (NFC), is planning a series of activities to help combat this, Mrs Teo said.

It includes a series of talks beginning this Saturday to help workers and their spouses. For instance, they will be advised on matters ranging from budgeting to handling spousal conflict.

Initially, the series will be held at NTUC Centre in the business district, moving later to the heartlands. There are also plans to organise joint programmes with family service centres, and to use new media such as a Facebook account and online forums to offer advice for families hit by the downturn.

"The financial crisis has apparently given a lesson on spending to young people in China, including me," said Wang, who posted his campaign on a popular forum and on his blog blog.soufun.com/whblog. It has had 178,000 hits.

China has enjoyed phenomenal economic growth for years, giving a huge boost to its domestic consumption. Young consumers, mostly in their late twenties and early thirties, would spend as much as they earned, if not more, on designer clothes, electronics, entertainment and a wide variety of consumer goods.

Now, at least, some are becoming thrifty.

Besides Wang's cost-cutting crusade, another website is running a similar "100 yuan for a week" campaign, and still other websites offer budget tips, including recipes for meals that cost under 10 yuan.

One site offers Ten Mottos for Financial Winter, with advice that includes avoiding quitting your job, starting a business, buying a car and having a baby.

These cost-cutting campaigns are in sharp contrast to a government drive to encourage spending amid rising unemployment and slowing retail sales.

The government has allocated 4 trillion yuan in spending to help achieve the goal.While still mostly a grass-roots campaign, cost-cutting drives are indicative of slumping consumer confidence in China and could take a toll on the economy if they become even more widespread, said Lin Songli, a senior analyst with Guosen Securities in Beijing.

"Though not quantifiable, confidence is crucial for the economy," he said.

About 46 percent of Chinese said their country's economic situation was good in November 2008, compared with 90 percent in 2007, according to an Ipsos survey published in December.

Jun Ma, chief China economist at Deutsche Bank in Hong Kong, said he expected retail sales to grow just 13 percent this year, partly due to fast-falling prices. Retail sales are projected to have grown about 21 percent in 2008.

Like their counterparts in western countries, young Chinese white-collar workers in big cities such as Beijing, Shanghai and Guangzhou tend to overspend.

A Shanghai government survey in November 2008 said office workers in the Chinese financial hub spend an average of 2,500 yuan a month. According to government statistics in September, average monthly income in Chinese cities is 2,192 yuan.

Expensive products such as electronic gadgets and luxury goods have sold like hotcakes in China, especially among young professionals who were all too willing to shell out their entire salary to buy such items as an Apple iPhone.

"I've changed my cell phones every six months since graduating from college," Wang said.

"But when the global financial crisis comes, I'm feeling pressure from my company which has foreign stakes," he said, explaining that he was worried about losing his job.

Wang is still grappling with the challenge of getting by on 100 yuan a week for all meals, transportation and entertainment.

In Beijing, 100 yuan buys nine McDonald's Big Mac burgers, roughly half a tank of gasoline, a monthly home Internet connection, or two movie tickets.

To cut costs, Wang now eats steamed buns for lunch instead of pizza, and he cycles for 20 minutes to work every day, instead of taking buses.