The Government of Singapore Investment Corporation (GIC) suffered an investment loss of between S$45 billion to S$50 billion last year, two unnamed sources told Dow Jones Newswires yesterday.
Temasek Holdings, Singapore's second sovereign wealth fund, saw its investment portfolio fall by S$58 billion- in the eight months to November 2008.
Together the paper losses add up to more than S$100 billion as they are not going to sell down any of its major investments. They'll wait until they recover. It's so simple, just sit on it and ride it out, time will heal all wounds, prices will recover sooner or later.
The major lesson that we learn here is that we simply cannot afford to be complacent during the good time, assets build up over the years can go down the drain faster than we would have expected.
So, how competent are the fund managers in these 2 organisations? I don't have the answer.