Stupid Genius

- Making mistakes is our rights, learning from them is our responsibilty.

- "I have no choice" is another way of saying "I've have chosen the easier option"

- Genius is 99% perspiration and 1% inspiration - Thomas A Edison

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Location: Singapore

Saturday, December 09, 2006

I am not confused about the meaning of subsidy. My understand of it has always been, I buy something at $X dollars, and I can claim all or a portion of it as subsidy, so that the thing is not really $X, but $X - $Subsidy.

A recent charity organisation brings a new meaning to it. Let's say the product cost $x. The patient do not buy the product themselves. T managed to procure it at $6. They sold it to the patients at $8 and claim that they are subsidised $2. But NKF actually earns $2 from the subsidy they gave to the patients. This baffles me. How do come can give people subsidy and still earns from it. Isn't it just a sales at a competitive price? So now all the shops out there when they want to give discounts, they can claim it as subsidy? This is all fine if the organisation in question not a charity organisation that get huge amount of donation from the public to subsidise the patients...

Then even more recent, my friend told me about something that HDB said. HDB has always given us Singaporeans the opportunity to own flats in a subsidised rate. So nice of them. But with the rising price of the flats, there had been complaints about the subsidy that HDB gives. Someone from HDB say that the flats are subsidised based on market rates.

Wait, isn't that similar to the charity organisation case? In fact they go 1 up on it. Isn't the market rate for HDB flats specified by HDB themselves? So now, I make my own product where my cost is $5, and claim that the market price is $10, so I sell it at $8 and claim that you are subsidised $2. I wonder if the private developers can do that...

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