TEMASEK TO RECOUP FTX LOSSES? – NOT SO FAST

When Ho Ching said Temasek can take the contrarian view, in regards to the FTX investment decision, she meant the sovereign wealth fund has a balance sheet large enough to take the risk. Indeed, writing off the US$275m was no big deal. Now news coming out of the bankruptcy proceeding in Delaware gives hope all creditors and investors may be paid off in full.

According to new CEO John Ray, the records were in total chaos. There was no proper accounting. This seems ironic because Jen Chan, the CFO, was the only one in FTX C-suite who had any direct work experience in the area of the business she oversaw.

Sam Bankmann-Fried himself produced an excel printout of a statement of assets and liabilities. Hardly any accountant can understand what SBF showed unless one has some experience with FX/crypto trading. It is not an asset-liability statement but a statement of spot positions. Basically it is a list of crypto tokens (and some fiat?) FTX holds and what’s payable. There was a massive shortfall of US$8.7b based on valuation on bankruptcy petition date.

Coindesk estimated the balances of tokens as at petition date for chapter 11 bankruptcy protection in 22 November 2022, of assets US$2.5b and liabilities of US$11.2b, showing a massive shortfall of US$8.7b. Everyone ran around with FTX being insolvent to the tune of US$8.7b. It’s the same figure being bandied about in the court hearings.

What a difference 18 months make. The talk now is FTX has more than enough assets to pay fully all creditors and in fact the investors too. Expectations are now running high that investors like Temasek will be paid off. The reason is crypto market has bounced back so current asset valuation has quadrupled. Actually it is much more than this. By now, the debtor committee has much more information on FTX’s portfolio of 416 venture investments. The asset figure now comprise token holdings and investments computed on discounted firesale valuations.

This reversal of FTX financials has brought some criticisms on the bankruptcy proceedings and the legal actions against SBF. Example Ian Ayres and John Donohue published this article “FTX Was Never Really Bankrupt” at Project-Syndicate on 26 Jan 2024. According to the duo FTX suffered a liquidity problem and was never insolvent. They added in fact, SBF is a brilliant businessman.

All those who think post petition valuation now makes FTX in a net asset position are absolutely wrong. Ian Ayres and John Donohue may be excused if they are a Tom Dick and Harry blogger. Ian Ayres is Professor of Law at Yale University and, John Donohue is Professor of Law at Stanford Law School and a research associate at the National Bureau of Economic Research. Let me explain why they, like many others, are wrong.

Of the spot token positions, based on petition valuation, FTX had assets US$2.5b and liabilities of US$11.2b. Today’s valuation the assets have quadrupled to US$10b due to crypto market appreciation. Add to this the discounted values of investments, the assets are enough to pay off all creditors and investors, or so it seems.

This view is incorrect. There are no net assets. If token assets have quadrupled, so too would the token liabilities of US$11.2b be more or less quadruple to US$44.8n (depending on its composition). FTX is as insolvent now as it was prepetition. This really makes professors Ian Ayres and John Donohue look silly.

But the debtor committee is correct that postpetition valuation should be able to pay off creditors because the system is skewed against creditors. Under US Bankruptcy Law, creditors’ claims are fixed at exchange rates on petition dates. Thus with crypto market rising, asset tokens quadrupled to US$10b, while creditors’ claims remained at prepetition US$11.2b. With asset tokens now worth US$10b + investments, debtor committee is proposing 100% payback plus interest for all creditors below US$50,000. This would take care of basically 98% of all creditors who can expect 118% payback.

This unfair valuation practice arises because crypto brokers, like FTX, do not segregate customers’ funds from proprietary funds. They are co-mingled. Crypto traders leave margin deposits and tokens with FTX. While FTX would record the credits due to customers, the cash and tokens they received have no segregated debit asset accounts. And what’s more damaging is FTX made use of these customers’ assets, such as lending to their crypto trading arm Alemada Research. In other words, they were acting like banks, lending out customers’ deposits.

For context, compare to the accounts of a law firm. In accounting for solicitors, clients' money are kept separate from the firm’s own money.

On a side note, the government’s management of investments is like FTX. It co-mingles all the funds that the Ministry of Finance handles, namely proceeds of government securities (ie loans), foreign currency reserves, fiduciary funds (from statutory boards) land sales proceeds and past reserves.

By freezing creditors’ claims at prepetition level, the market talks of a good chance of payback for investors like Temasek. But not so fast.

Distribution in a bankruptcy are made in a certain priority order. First all creditors with claims secured against specific assets will be paid from disposal of said assets, any unmet balance will fall as unsecured creditors. Second are the creditors holding debentures. These are secured against the general assets of the company. Third comes the preferred unsecured creditors. This is itself prioritised to (1) bankruptcy management cost (lawyers, advisors, consultants, manager), (2) employees, (3) government agencies, especially the IRS. Fourth comes the unsecured creditors. Fifth the holders of Preference shares. Lastly, holders of Ordinary Shares.

Debtors’ counsel Andrew Dietderich of Sullivan & Cromwell, projected that customers and general unsecured creditors would be “paid in full” but qualified that his statement should be understood “not as a guarantee, but as an objective.” The Internal Revenue Service has an estimated $24 billion in asserted tax claims, which the court noted was recently reduced to approximately $8 billion. This is pending burden of proof by IRS. The IRS tax claim is so huge it puts in serious doubt that unsecured creditors can be paid in full.

Dietderich said the full payment of creditors is contingent on the voluntary subordination of governmental claims to creditor recoveries, i.e., IRS allowing unsecured creditors priority to distribution.

The debtors’ are also working on establishing billions in tax loss carry forwards. Although not quantified, Dietderich sounded confident that even if IRS do not agree to voluntary subordination of their claims, the tax loss carry forward will reduce IRS claims substantially that will still allow for full recovery by unsecured creditors.

Whether there is any assets left for distribution to Temasek et al depends on how much is the tax claim and the tax loss carry forward allowed. Should Temasek ever make any recovery, the injustice of it all is, it is enabled largely by the assets of FTX customers. The only ones laughing all the way to the bank are the lawyers.  They have paid themselves about US$400m so far. 

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SINGAPORE IS WORLD'S TOP START-UP COUNTRY BY VC FUNDING PER CAPITA

Singapore has the highest venture capital funding for start-ups in the world. Before we pop the champagne, this is on per capita basis. This is to be expected of a city state with a small population base.  Nevertheless, on per capita basis, Singapore's VC funding of US$1,060 for each resident is far ahead of the competition. In 2nd place is US which is far behind  with US$345.

PitchBook made a 2024 ranking of VC Ecosystem of 50 global cities sourced from their own database. It is based on the size and maturity of the start-up networks in the cities.

Other Highlights:

On overall 'Development Scores', the top three are San Francisco, New York, and Beijing. Singapore lies at 14th with Hongkong at 26th.

Singapore ranks 2nd in terms of 'Growth score'. The Chinese city of Hefei ranks #1 with a score of 86.5 compared to Singapore's 74.8.

Based on 'Development Scores', these top 50 cities are distributed across 12 countries:

20	US	1	Brazil
11	China	1	Hongkong
6	EU	1	Israel
3	Canada	1	Japan
3	India	1	Seoul
1	Australia	1	Singapore

On the rivalry between US and China, the Chinese are still far behind. The US had capital raised of $873b and deal count of 55,023 compared to China's $476b and 32,914 respectively.

The 3 IT centres of India are Mumbai, Bengalaru and Gurugram. Most of our CECA tech foreign talents are likely from these cities.

Details of the top 14 cities are show in the table below. Singapore's position for each measurement factor is also shown.

(Development and Growth scores are based on data related to deals, exits, fundraising and other factors from the last six years.)

The government had set its sight on building Singapore as a high-end technology Hub as an important engine of growth and betting on technological advancements to spur innovation. The rankings is testament to policy success and Singapore's high 'Growth Score' points to a positive future for the sector.

Nurturing a start-up ecosystem requires heavy investments in hardware and software infrastructures. State of the art communication capability is a must, thus the rush to 5G - the optic of being first mover matters. We want to be seen as first adopters of all things in the tech world. We are the first country to approve cell-cultured chicken. We need to have the legislation necessary for the new digital era - laws on e-contracts, protection for intellectual properties, cell-cultured food, etc. We need to make the island a socially bustling metropolitan that is a livable place for an international workforce. Taylor Swift tour is just a part and parcel of all this. What is also needed is an extremely business-friendly government and of course easy foreign labor visa regulations.

A start-up ecosystem is a melting pot of entrepreneurs, founders, VC companies, bankers, specialist lawyers and bankers. All deal makers and investors who want a slice of the opportunities seek to entrench themselves into this highly networked ecosystem.

Currently there are 5,137 start-ups in Singapore. They are listed here.

Looking through the non-investing Singaporean layman's lenses, there are some concerns.

One recalls Minister Edwin Tong had to invest millions of dollars to entice Taylor Swift to stage her tours in Singapore. To build the infrastructure for start-ups, the government spends billions over the years. How much has Enterprise Singapore and other agencies dished out by way of grants and soft loans to attract these companies here? We are talking of billions of taxpayer dollars. There is no balance sheet reporting.

For a small country it makes no sense to be purely a passive hub for start-ups of tech plays which are highly mobile when they exit and has no advantage to be domiciled in a country with the highest cost of operation.

Singapore offers no advantage to set up an industrial base. There are understandably no heavy tech plays in the island. Heavy Tech start-ups are all happening in China, which are driven by government funding in industries aligned to their long term economic strategy, such as in semiconductor, electric vehicles, 5G commercialisation, vaccine application, chip manufacturing, etc. Heavy tech plays promise the job creation Singaporean layman wants. A search at the list of Singapore start-ups show mostly e-platforms, fintechs, and low headcount service related plays.

Obviously the government hopes to develop indigenous innovation capability in the long term. In line with this, Singapore has developed a strong framework for protection of intellectual property. As early as 2016 the WEF, in its Global Competitiveness Report, ranked Singapore number two in the world for IP protection. But what does this all mean to the man on the street. How does this translate to the real economy?

GreyB Services, a specialist consultancy outfit, did an analysis of patents registered in Singapore for the 6 years 2015-2020 which showed some interesting pointers. There were a total of 88,859 INDAPOC Families of patents filed in Singapore. Patents that originated from Singapore numbered only 7,872 or 9%. The bulk of the patents were priority foreign counties - US 48%, Japan 17%, EU 10%, China 5%, Others 11%.

GreyB parsed the data to see who were the 5 top patent filers originating from US, Japan and Singapore :
US : ExxonMobil (1,146), Qualcom (1,105), LAM Research Cor (499), Saudi Aramco (495) and Novartis (468).
Japan: Mitsubishi (894), Disco (427), Toshiba (401), Sumitomo (178), and Hitachi (378).
Singapore: A*star (1,232), Mastercard (586) Halliburton (290), National University Singapore, (280), and Nanyang Tech University (170).

The top 5 filers of patents originating in US and Japan were all corporations and none from academia. Filers originating in Singapore were academia and government research institution A*star and 2 foreign owned corporations.

It is common for corporations to collaborate with academia to benefit from their R&D resources and scholars. It seemed A*star, NUS and NTU were collaborating with many well-known international names like IBM, Huawei, MIT, as well as local government agencies like Singapore Health Services. Where are the indigenous corporations.

The point being made here is this. The government spends vast sums of money promoting R&D and patent filing. It allocates billions of dollars for each Five-Year Science & Technology plans. For example the Research, Innovation and Enterprise 2020 Plan has a budget for an astounding S$19b. The government largesse for R&D and patent filing, is to encourage indigenous corporations develop R&D capabilities and hopefully breaking out as start-ups to commercialise their ideas, thereby contributing to the economy and creating jobs. However, the glaring absence of home-grown corporations benefitting from government largesse has Singaporeans wondering what's it all about.

The hive of activity of the start-up ecosystem is a boon to the rentier and financial economies and the international investment community. The Payback to the real economy does not seem to be obvious.

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DEATH OF BUDDHA, CHRIST, AND MOHAMMUD

Siddharha Gautama or The Buddha, Jesus of Nazarath or Christ, and Mohammud Ibn Abdullah, were founders of the three great religions Buddhism, Christianity and Islam. In the case of Mohammud, rather than founder, perhaps it is more appropriate to say the Holy Book of Islam, the Quran, was revealed through him. All three died under controversial circumstances. Laying out their deaths side by side makes an interesting read.

Buddha:

Sometime between 487-483 BC, The Buddha and his entourage reached a place called Pala. There a local blacksmith, Cunda Kammāraputta, asked to honour him with a bhiksha, a food that is customarily offered to monks. The exact meal is unknown but thought to be a dish of pork. Contrary to public perception, Buddha was not a vegan and he never banned meat. He ate in moderation and take very little meat. After consuming the meal, he felt sick and asked for the remaining portion to be buried. The party then made their way to Kushinagar which is in the current state of Bihar.

At Kushinagar, the 80 year old Buddha knew his end was near. He consoled Ananda, his cousin, scribe and faithful follower, reminding him of the impermanence of nature and that he too must pass on. Then he asked his disciples if there was any doubts in the teachings. The Buddha laid down on his right side in the famous reclining posture, went into meditation, and entered mahaparinirvana (the great passing). It is said he reached enlightenment and thus has been freed from the cycle of rebirth.

The exact year of his death is unknown. It is generally believed to be 487- 483 BC but the southern tradition of Sri Lanka placed it at 544 – 543 BC. So too the cause of death. Was it food poisoning, or was he poisoned. After all, there had been three unsuccessful assassination attempts on his life by Devadatta, a cousin and ex-disciple who caused a schism a decade earlier. Buddha entered parinirvana in Kushinagar, but the exact location of his death is unknown.

Buddha was cremated at the Ramabhar Stupa, on which site the Indian Government built the  Mahaparinirvana Temple in 1956 as part of the commemoration of the 2,500th year of the Mahaparinivana or 2500 BE (Buddhist Era).

In 1870s British army engineer and archaeologist, Sir Alexander Cunningham, discovered a huge vaulted chamber at the Ramabhar site he estimated no later than 637 AD. In the vault were broken pieces of the statute of the reclining Buddha. The statute was repaired and now displayed at the Mahaparinirvana Temple.

Xuanzang 玄奘, the famous monk in the Ming Dynasty classic novel 'Journey To The West' 西遊記, undertook a 17-year journey from China to India (629-645 CE) to collect Buddhist scriptures and to study Buddhism at its source. His journey is well-documented in his work, "Great Tang Records on the Western Regions" (大唐西域記). During his travels, Xuanzang visited many significant Buddhist sites, including Kushinagar. Xuanzang described the stupa built over the place where the Buddha passed away. He noted its dilapidated condition at the time but mentioned that it still attracted pilgrims who came to pay their respects. The reclining Buddha we see here is the very statute Xuanzang saw.

The Buddha’s relics (skull bones, teeth, inner and outer shrouds) were distributed to the other eight kingdoms of ancient northern India. Asohka The Great (304 – 323 BC) later built 84,000 stupas and redistributed the relics which were enshrined in many of these dome-shaped structures seen at Buddhist temples. In 1984 I visited the famous Temple of the Tooth in Kandy, Sri Lanka, but never had the chance to view the relic as it was opened to public viewing only on special occasions. They opened for private viewing to some visiting dignitaries and I was told by some locals the privilege was accorded to Lee Kuan Yew on his 1966 visit.

Christ:

Christ was crucified and died on the cross at Golgotha. The Bible provides some details from which some clever Sherlock Holmes analyzing will provide the time, day and year of death. The time of death is easy. He died on the 9th hour which is roughly 3 pm. Matthew, Mark, Luke and John all said he died on Preparation Day. This is the day Jews prepare for Sabbath which is on Saturday. Thus the day of death was Friday. And that’s how we get Good Friday. The year of death is a bit tough and there is no consensus amongst scholars. Preparation Day is Nissan 14 in Jewish calendar; Pontius Pilate was prefect of Judea and Samaria from 26AD to 36 AD. It boils down to when Nissan 14 falls on a Friday during 26-36 AD. There were two : 7 Apr 30 AD and 3 Apr 33 AD. It seems 3 Apr 33 AD is the better bet because there was indeed a solar eclipse that day.

The Last Supper was on Thursday which was Passover. The parallelism is Jesus is the sacrificial lamb on the cross for atonement of sins of mankind. The next day was Friday which was the trial and crucifixion of Jesus. On Sunday, Christ resurrected. The Bible mentions the supernatural event of the sky turning dark and earthquake at the time of his death. Non-Christian sources were Jewish historian Josephus and Romans Tacitus, Pliny The Younger and Suetonius, all writing about 70 years later, mentioned Jesus, the crucifixion, and Pontius Pilate trial.

There are many who claim ancient Chinese record also made reference to the death of Jesus. Let’s fact check this.

The Chinese classic, History of the Latter Han Dynasty 後漢書, is one of the official Chinese historical works which was compiled by Fan Ye in the 5th century, using a number of earlier histories and documents as sources. It covers the history of Eastern Han from 25 to 220 AD.

Chapter 1 specifically in the "Annals of Emperor Guangwu" (光武帝紀) there is a passage that reads:

夏四月壬午，詔曰：陰陽錯繆，日月薄蝕，皆人臣之罪，在朕一人。布告天下，咸令赦罪.

“In the summer, fourth month, on the day of Ren Wu, the imperial edict reads, “Yin and Yang have mistakenly switched, and the sun and moon were eclipsed. The sins of all the people are now on one man. Pardon is proclaimed to all under heaven.”.

Another passage simply states: 天人死 "Man from Heaven died”.

By word association it is very seductive to jump to the conclusion the Chinese were referring to Christ. Indeed a Google search easily shows up thousands of people with this cognitive bias. Not to mention the hundreds of thousands in social media who share the Youtube videos and online posts without so much as a second to consider whether that can be true..

The fact that these words appear in the section "Annals of Emperor Guangwu" is a dead give away. Emperor Guangwu (Liu Xiu) was the founder of Eastern Han Dynasty. His reign was 25-57 AD. Guangwu re-installed the Han Dynasty for another 200 years. He was a very able emperor who was regarded with high reverence. Ancient Chinese consider their emperors Sons of Heaven. Just like Zoroastrians, ancient Chinese read celestial events and predict natural disasters, sometimes requiring an emperor to take responsibility and offer pardons, make sacrifices, or make amends. With no reference to context, in all probability the 'History of the Latter Han Dynasty' was about Guangwu and a local event.

What happened after the crucifixion is all from Christian tradition. Jesus died on the cross. A rich merchant Joseph of Arimathea, who was his uncle, had Pilate’s permission to take down the body. Joseph wrapped the body of Christ in linen cloth and placed it in his own tomb which was a cave. A big boulder was rolled over the enrance of the cave. Three days later, a small group of women, including Mary Magdalene, visited the cave to find it empty. They were told by angels that Christ had risen.

Then followed a series of sightings. Christ appeared to many including the apostles and a group of 500 people. Did they see an apparition or Christ in flesh and blood? The disciple Thomas, when told Christ had appeared to some of them, found it incredulous and said he will only believe if he can see and touch. When Christ appeared before Thomas, the apostle was asked to place his hand on the wound where Longinus, the unknown Centurion, had pierced Jesus with his spear in a coup de grace. Thus was the term “doubting Thomases” derived.

Forty days after His resurrection, Christ ascended to heaven. The apostles witnessed this event which took place near Bethany, on the Mount of Olives. Two angels then appeared who told the apostles Christ will return in the same manner.

The death of Jesus, his Resurrection, Ascension, and promised return, is the bedrock of the Christian faith. Jesus’ death provided atonement for sin and salvation and offered eternal life to all who believe in Him. His Second Coming is when He will fully establish God's kingdom and bring final judgment.

The body of Christ is lost to antiquity. Did He rise in spirit or flesh and blood. It’s an unsolved mystery, but the faith rests on a Freudian puzzle and a physical evidence in a piece of cloth.

We see a group of apostles in hiding after the crucifixion, frightened of Roman persecution and Jewish mob, and questioning their faith, for how could a Son of God die on the cross. Something supernatural must have happened to then spur them onto evangelical zeal and face martyrdom. Only John the Evangelist died a natural death. The other apostles including Paul, died painful deaths in the hands of their persecutors. The supernatural event that gave them the courage and conviction can only be explained by the appearance of a Risen Christ.

In an era when Faith is challenged by Liberal thoughts and congregation at churches are dwindling, latest technology and forensic tests is proving The Shroud Of Turin is authentic. Science can now explain the burst of energy that left the negative imprints on the piece of cloth. It does seem Christ indeed had risen and actually left his facial features on the fabric. There remains of course many skeptics and opinions galore from all who are not privy to even touching the fabric and direct examination to declare it fake.

The Quran too has a say in the matter. According to the Quran, Jesus is not God-incarnate, but a creation of Allah and virgin born. He was human and a prophet. Jesus did not die on the cross. Allah saved Jesus by putting someone who looked like him on the cross. Allah “raised Jesus up to Himself”. The anti-Trinitarian thread runs very deep in the Quran. If the book is to be believed, then Jesus is alive in heaven and sitting on the throne with Allah.

Mohammud:

The prophet died in 632 AD but the Quran does not say anything about his death and so no one knows what happened to him after his passing.

Some time back I made a Facebook post and asked if anyone could answer the million dollar question why the Quran does not mention Mohammud’s death. It was a simple question on critical thinking. No one offered an answer but a couple of Muslim commenters took umbrage. Why a question like that be deemed offensive I have no idea. I think perhaps it arises from the Muslim psyche. No believer is allowed to question anything in the Quran. If that be the case, that restriction does not apply to non-Muslims.

The answer to the FB question is so simple. The Quran is a product of Mohammud. No Mohammud, no Quran. The Quran may be a revelation of God, but Mohammud put it out there. Mohammd made no revelation about his own death when he was alive, and obviously has nothing to say after he died.

What did Mohammud wish for his own death and how did he die. Most do not know, including believers.

Note that I insert no opinions from here on. The following are all based on facts. Now there are different layers of facts. There are facts which are evidentiary – an event actually happened, or things actually existed. For the purpose here, facts mean what’s described here are actually written in the Quran, hadiths, taffsir, and siras. Nothing mentioned here is fabricated.

In hadith of Sahih Bukhari 2797
Narrated Abu Huraira: “The Prophet said, "By Him in Whose Hands my life is! Were it not for some men amongst the believers who dislike to be left behind me and whom I cannot provide with means of conveyance, I would certainly never remain behind any Sariya' (army-unit) setting out in Allah's Cause. By Him in Whose Hands my life is! I would love to be martyred in Allah's Cause and then get resurrected and then get martyred, and then get resurrected again and then get martyred and then get resurrected again and then get martyred.”

The Messenger of The Religion of Peace wanted to be a serial martyr, dying in martyrdom in an orgy of battles. Sadly, Allah did not grant him this wish. 

Several hadiths relate Mohammud’s death to poisoning but Islamic tradition mostly do not refer to this and the Muslim laity generally are unaware.

The poisoning episode took place at a feast in Khaybar, date of event unknown. In 628 AD. Mohammud’s forces attacked the Jewish settlement of Khaybar which is located outside of Medina. The Jews lost and surrendered, their leader killed in battle, Jewish men slaughtered, children and women taken as slaves. Mohammud married the prettiest woman slave Safiyyah bint Huyayy. At a feast in Kharbar, Mohammud accepted the dishes prepared by a Jewish woman Zaynab bint Al-Harith, whose whole family had been killed in the battle. Zaynab put poison on the leg of the lamb that was served to Mohammud and his companions. A few of the men died shortly after the meal. Mohammud suffered much longer from the poisoning, eventually dying from it in 632 AD.

The Islamic sources that mention the poisoning can be found in several hadiths tafsirs, e.g. Sahid Bukhari 2717, Sahih Muslim 2190a, Sunan Abi Dawud 4513, etc.

Let’s refer to Muhammad ibn Sa'd ibn Mani' al-Baghdadi, one of the most respected Islamic scholar. He wrote 'Kitab al-Tabaqat al-Kabir' in early 9th century AD. This is one of the earliest comprehensive collections of biographical information about the Prophet Muhammad, his companions, and subsequent generations of notable Muslim figures. In Vol 2 page 249 is an “Account of the poison which was given to the Apostle of Allah”. It listed various narrations of the incident.

For example, Umar Ibn Hafs said that Malik Ibn Dinar said : “Verily, a Jewish woman presented poisoned (meat of) a she-goat to the Apostle of Allah, may Allah bless him. He took a piece from it, put it into his mouth chewed it and threw it away. Then he said to the Companions. ‘Hah, verily, its leg tells me it is poisoned.’ Then he sent for the Jewish woman and asked her ‘What induced you to do what you have done?’ She replied ‘I wanted to know if you are true; in that case, Allah surely will inform you, and if you are a liar, I shall relieve the people of you.’ ”

Islamic tradition cites this incident to illustrate Muhammad's trials, his mercy and forgiveness, and the divine protection he received throughout his mission. Taken in this light it seems strange because some narration said Mohammud spared Zaynah but others said he ordered the Jewish woman killed. Allah did not protect him from the poison, the roasted leg of the she-goat (some said it was lamb) told him of the poison after he had taken a bite.

Mohammud returned to Medina and Islamic sources mention his health faltered and he suffered severe paid before he died.

Sahid Bukhari 5.713:
Narrated 'Aisha: “The Prophet in his ailment in which he died, used to say, "O'Aisha! I still feel the pain caused by the food I ate at Khaybar, and at this time, I feel as if my aorta is being cut from that poison."

It’s worth noting that Mohammud consistently mentioned the pain is like his aorta being severed. This has led critics to a verse in the Quran now dubbed 'The Curse of Allah'.

Surah 69: 44-46:
وَلَوْ تَقَوَّلَ عَلَيْنَا بَعْضَ ٱلْأَقَاوِيلِ لَأَخَذْنَا مِنْهُ بِٱلْيَمِينِ
ثُمَّ لَقَطَعْنَا مِنْهُ ٱلْوَتِينَ

“Had the Messenger made up something in Our Name, We would have certainly seized him by his right hand, then severed his aorta.”

There is that aorta again. Allah’s promise that he will kill Mohammud should he ever lie. The manner as to how Allah will do it is left to no doubt. Islamist apologists have a hard time explaining the irony. A typical response is one should not take ‘aorta’ in the literal sense, it probably is a manner of speech to mean great pain. Interestingly, depending on the particular poison, one of the symptoms is severe chest pain.

Muslims bury the dead within 24 hours. This is in accordance with Mohammud’s practice to “hasten the funeral rites”. Mohammud himself was buried after 6 days. There is nothing wrong with Islamic jurisprudence for delayed burial under special circumstances as long as respect and dignity is accorded to the deceased. In Mohammud’s case, due to his position, a delay was necessary for many followers who want to pay their respects. Succession issues also needed to be discussed.

So after death, where is Mohammud. Hadith of Sunan Abu Dawood says Mohammud said he has an intercessory role to play on Judgement Day, and both Sahid al Bukhari and Sahid Muslim say Mohammud said he will be the first to be resurrected. Do hadiths (recollections of sayings and deeds of Mohammud) or Quran (Word of Allah) have higher authority, for in Surah 46.9 Mohammud says “nor do I know what will happen <after death> to me or you”. Muslim scholars point to Surah 108.1-3 which says : "Indeed, We have granted you, [O Muhammad]. So pray to your Lord and sacrifice [to Him alone]. Indeed, your enemy is the one cut off." Their interpretation of ‘al-Kawthar’ means some overpowering abundance that encompasses the physical and spiritual, that would certainly mean his place in heaven is assured. The verse on its own, well and good. But the context is this revelation was during the time when Mohammud was rejected by the people of Medina. Certainly his followers needed the ‘Al-Kawthar’ motivation.

It seems strange that Allah would save Jesus from crucifixion and raise him up to himself, but didn’t save Mohammud from the poison, and left the concluding narrative of whereabouts of Mohammud to speculation.

Mohammud was buried in a compound in Aisha’s house which was next to the mosque Al Masjid an Nabawit in Medina. Over time the mosque expanded and has taken over the land of Aisha’s house. Today Mohammud’s burial site is within the dome of the mosque.

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WHO IS BEHIND TRUMP?

As a little kid back in the days when PAP was battling socialists and communists in Singapore, I could see how enemies of democracy camouflaged themselves as libertarians and accuse the other side of wanting to destroy democracy. Today, we see the same agitprop playbook of the liberal left and Democrats in US employed against conservatives and Republicans. Any social or political activist, or fund raising group which has ‘Democracy’ in its name, is almost usually pushing anything but democracy.

If elected in 2024, Trump will be a dictator and he will jail all his political opponents. A small group of people decided that will be the talking point and all leftist mouthpieces take to the airwaves with coordinated headlines and speeches. If you were Rachel Maddox of MSNBC drawing US$28m a year, you would be incentivised to poison the well for Trump. As would the denizens slithering in the pits of leftist media. It surprised no one when Hillary Clinton joined the fray. All seemed to not realise they had 4 years of Trump and no one was jailed. Least of all Hillary whom Trump refused to carry through a campaign promise to prosecute when he was in the White House because, as he said later, “it wouldn’t be the right thing to do (prosecuting a political opponent).”

The lawfare currently going on in the US against Trump leaves no doubt who is the dictator and who are being persecuted. The collusion between Biden’s White House, federal law enforcement agencies, and state prosecutors, are slowly becoming clear. Information shared from FOIA suits and unsealing of motion documents by non-partisan constitutional judges have shown state prosecutors visit the White House on many occasions. There is no question who is pulling the strings on the high profile cases against Trump. The transfer of Democrat activist Matthew Colangelo from DOJ to New York confirms the weaponisation of an agency of law. Colangelo was obviously tasked as the hatchet man to get Trump in the classified documents case, unless a move from the third highest ranking official in DOJ office to a public prosecutor in a Manhattan District Attorney’s office is somehow a promotion.

Those following the progress of the cases against Trump may be excused if they seem to see some sort of Marian intercession going on. Events seem to transpire for the accusers to be shown guilty of the very same acts they accuse Trump of.

In Fulton County election 2020 fraud case, Georgia DA Fani Willis charged Trump et al with conspiracy to defraud the election under the RICO Act. This is for racketeering, which is legislation against mob-related crimes. Apart for the argument before SCOTUS on presidential immunity, the defence’s case rests on the argument it is well within a president’s responsibility to call for investigation into an election if he felt the integrity of the vote is questionable.

The case is in jeopardy. Willis herself has been proven to lie in court, conspired to defraud the state by engaging the services of her lover Nathan Wade at a higher rate as special prosecutor (Wade is a lawyer specialising in divorce cases), and corruptly benefiting from the arrangement. She has been subpoenaed separately by Congress and State Senate to attend their investigation into her conduct. Presiding Judge Scott McAfee decided the pair in breach of judiciary standards of conduct serious enough to warrant removal from the case. However, it is strange he found it serious enough to remove Wade but not Willis. McAfee once worked for Willis, and the judge is a donor to the DA. Unfortunately for Willis, she now faces an appellate court hearing brought by the defendants for her dismissal from the case. 

The Stormy Daniel case in Manhattan is unique in its non-specification of charges. DA Alvin Bragg said it is not necessary for him to specify the charge. The prosecution’s case is Trump falsified accounts by recording ‘hush money’ payment to Stormy Daniels as ‘legal fees’. This is not a criminal act, but it becomes a felony if the act was performed in furtherance of another act. Bragg said Trump falsified the accounts so his 2016 presidential campaign will not be impaired. It thus becomes a felony. The case is allowed to proceed despite the fact Trump has nothing to do with accounting entries and the payment was made in 2018 so it's difficult to see how it influenced 2016 election.

There is a great tabloid story here of whether Trump had sex with a porn star. But it’s all anecdotal and has nothing to do with the case before the court. The judge allowed Daniels two days in the witness box giving lurid details of her liaison with Trump which has nothing to do with the case but prosecution-coached (Daniels admitted) tactic to humiliate the defendant. I restrict my comment here to the point of the accuser being revealed as the one committing the very acts the defendant is accused of.

Daniels, whose real name is Stephanie Clifford, is a porn star and film producer. She once sued Trump for defamation where she was represented by Michael Avenatti, a lawyer now dis-barred and serving time for fraud against clients. Recently, Avenatti made a revelation from his prison cell. He said a film producer approached him to participate in a film on Daniels’ story. From his queries he learnt from the producer that Daniels will be involved and her share of income from the film will be paid via a round-robbin mechanism. Her purpose was to falsify her accounts to avoid payment of legal cost of US$500,000 in two failed suits against Trump. The producer also mentioned that earnings from her memoir “Full Disclosure” was also handled this way. The book of course featured her one-night tryst with Trump. We do not know the veracity of this revelation, particularly as Avenatti was later found guilty of defrauding Daniels in the negotiation for the publication of her book. If true, then Daniels is just as guilty for falsifying her accounts in order to cheat Trump. This is exactly the felony DA Bragg is trying to convict the ex-president.

In the classified documents case, Trump is lucky he relocated his residence to Florida. In New York city, with progressive judges and liberal juries, he would have no chance for a fair trial and proper discovery because motion documents including witness interview transcripts, would be heavily redacted. With a constitutional Judge Aileen Cannon presiding, the sloppy prosecution has no special treatment from the bench and cannot get away with shenanigans. Judge Canon unsealed motion documents and boy oh boy, what do un-redacted materials reveal. The prosecution colluded with Biden’s White House, tampered with evidence, inserted false evidence, and stole Trump’s personal effects (amongst other things, Trump claimed FBI took his will).

Recall this photo that Biden’s FBI ‘leaked’ to Biden’s media. From the very first day the photo was first made public, conspiracy sites like Gateway Pundit and Alex Jones’ Infowars analysed it and were quick to point out it was an arranged setup just for the optics. It was meant to fool the public that Trump has so much classified documents they were lying all over the floor. FBI placed the documents on the floor for the photoshoot and those marked ‘SECRET’ were not classified documents but place holders. ‘Conspiracy theorists’ have now been proven correct yet again.

Documents in the boxes were not in the same sequence as the computerised inventory list. Prosecution admitted the documents have been juggled in the boxes. This is tantamount to tampering with evidence. The sequence in the boxes is important because it is proof the documents have not been handled since they were delivered from the White House.

FBI inserted one ballot of classified documents they brought from Presidential Archive Library into evidence. Fabricating evidence is criminal malfeasance. Perhaps DOJ, FBI and leftist prosecutors have become emboldened with the way they successfully ran roughshod over judicial processes tolerated by partisan liberal judges when they go after defendants who were conservatives, MAGA or Trump supporters and associates.

In the January 6 incident, all those Trump supporters who entered the Capitol should at most be charged with trespassing which is a misdemeanor. The Democrats have been longing for an event of white supremacist violence to pin the fascist label on Trump. Unable to establish insurgency, DOJ framed charges that can inflict the most severe sentence on defendants. The purpose is to create the ethos of white supremacist danger to democracy in US. Most defendants were charged with violating 18 U.S. Code § 1512, a very serious offence.

18 US Code § 1512(c)(2) states:

“Whoever corruptly or otherwise obstructs, influences, or impedes any official proceeding, or attempts to do so, shall be fined under this title or imprisoned not more than 20 years, or both.”

Under the dual justice system of US today, progressive judges set murderers free and Trump supporters receive 10-15 years in prison for trespassing and disrupting Congress in session.

What will the same dual justice system now do to Special Counsel Jack Smith and his team of prosecutors if the same 18 U.S. Code § 1512 is applied?

18 US Code § 1512(c)(1) states:

“Whoever corruptly alters, destroys, mutilates, or conceals a record, document, or other object, or attempts to do so, with the intent to impair the object’s integrity or availability for use in an official proceeding shall be fined under this title or imprisoned not more than 20 years, or both.”

The prosecution is guilty of the same crimes they charged those they accuse. When Trump called for Jack Smith to be arrested and jailed for evidence tampering and falsification, the 45th President has the law behind him.

Unsealed motion documents show Biden gave the green light for FBI search of Trump’s Mar-a-lago residence for the classified documents. Well, well, what do we all subsequently know. Biden himself carted away a ton of classified documents when he was Obama’s VP. The difference between Trump and Biden is wide. As president, Trump has a right to take documents from the White House after leaving office and has the right to declassify documents, which he did. Biden has no such right as VP. While Trump kept documents under secured storage (the security was actually vetted by FBI much earlier), Biden kept classified documents in his garage and in an office shared with a CCP-owned company. Special Counsel Robert Hur headed an investigation into Biden’s case. He minced no words to conclude Biden “stole” the documents. While they put Trump on trial, no Democrat or DOJ is going to do anything with Biden for committing the same crimes they accused the ex-president.

By June 2023, Mike Pence, Trump’s VP, and GOP nomination challenger for 2024, distanced himself from his ex-boss when he said: “Having read the indictment, these are very serious allegations. And I can’t defend what is alleged.” Well, well, what do we know. Pence himself has also been found to have “stolen” some classified documents just like Biden.

The over-valuation of assets case in New York brought by DA Letitia James against Trump is one for the books. Trump was found guilty of falsely inflating the value of his asset Mar-a-Lago. By declaring higher valuation, Trump was then able to obtain larger loans. It was a fraud case for which there were no victims, where a prosecution witness, a banker from Deutsche Bank, said they were not defrauded, they had every single dollar of loans repaid with interest, and that they were happy to do more business with their client. It was a case where every businessman ever interviewed said the prosecution has no idea how financing of real estate works.

Rabid Trump-hating partisan Judge Arthur Engoron plucked a figure out of thin air and said Mar-a-Lago was worth US$18m. Trump has always insisted it is more than a hundred million dollars. All leftist media has always refuted Trump’s claim including Trump-hating CNN which only last December ran a report on fact checking Trump’s valuation claims as false. Well, well, what do we know. CNN now says Mar-a-Lago is worth US$240m.

In NY courts, conservatives and least of all, Trump, has no chance of a fair trial. He lost and was fined US$450m. Only Alex Jones has received a higher fine under the Biden admin. Jones was fined US$1b in the Sandy Hooks defamation law suit. There are rules against excessive fines to prevent Judiciary excesses. Everyone knows both cases were politically driven and the fines were meant to financially cripple and bring the two enemies of Democrats to their knees.

Democrat DA James ran for office on a platform of going after Trump with no specific crimes in mind. One is reminded of Lavrentiy Beria, Stalin's secret police chief, who said “Show me the man and I'll find you the crime”.

The New York Post on 17 Mar 2024 carried a most interesting article: “An Irish society, an unpaid loan and the hypocrisy of Letitia James” This is the interesting story in brief.

The American Irish Historical Society is a private club which owns a grand old mansion at 991 Fifth Avenue across Central Park, NY City. A certain Cahill Family has been running the club house like their own heirloom. Mismanagement brought it to insolvency. They turned to a board director James Doyle, for a personal loan of US$3m and represented to him the mansion was valued US$80m with air rights (can build taller). The loan was structured like a mortgage loan with monthly installment payments. When the society defaulted on scheduled payments, Doyle called in the loan. He soon found out the mansion had no air rights and was valued about US$20m.

In stepped DA James who claimed she received a petition against the sale and that disposal of assets by NGOs requires the approval of her office. She was in awe of the clubhouse and encouraged members to save it. The loan was restructured. When the society again defaulted, Doyle commenced legal proceedings. DA James did all she could to frustrate the sale of the building.

One wonders at the enthusiasm of James to block the sales of the clubhouse. Why is a black DA so interested in the private affairs of an Irish community? Doyle has made an FOIA request for all communication between James, the society and the Cahills. Is there a can of worms somewhere?

Meanwhile it is very clear. Here is a case of falsification of asset values to secure a loan that is exactly the same as the one Trump is charged with. In Mar-a-Lago case, DA James takes the side against borrower Trump for falsifying asset values. In the Irish clubhouse she takes the borrower society’s side for falsifying asset values. If inflating asset values for a loan application is a crime as James claims, then she is aiding and abetting a crime by taking the side of the Irish society.

One must not forget the difference between Trump’s and the Irish society’s case. In Trump’s case, the asset is worth much higher than what the court says and Deusche Bank were paid back every single dollar. In the Irish society case, the asset is worth much lower and lender Doyle is still owed US$3m.

These four lawfare cases mentioned are clearly political prosecution of Trump. The timing and the massive fine suggest judicial partisanship attempt to cripple his 2024 campaigns. In other words, election interference. It’s a wonder how all the cases have boomeranged to show the accusers guilty of exactly the same crimes they accused Trump of. Certainly many are led to ask who is behind Trump?

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HOW GOVERNMENTS PRINT MONEY

The video is Jared Bernstein, an economic adviser to Joe Biden, struggling to explain why the U.S. government chooses to borrow money when it can just print more. It shows both the difficulty of understanding what exactly is government money printing and the incompetency of Biden admin’s appointees which explains the mess the country is in, such as a Supreme court justice who cannot define a woman.

Money itself is like a commodity and it has a price which bows to Keynesian doctrine of supply and demand. The price of a currency is of course its exchange rate in relation to other currencies. All things being equal, an increase in supply of a currency is inflationary because it stimulates spending and foreign goods become more expensive as its exchange rate depreciates.

Governments have the power to create money into existence and this opens the door to irresponsible fiscal management. Many are critical of money printing by governments, but most folks generally do not actually understand how this is done.

There are two types of money – paper money (currency notes) and digital money. The credit balances in depositors’ accounts with banks are digital money. When you deposit cash into your bank account, you convert paper money into digital money. The printing of physical currency notes and digital money are of course entirely different matters.

Central banks physically print currency notes all the time to constantly keep a ready stock to replace damaged notes and to meet exigencies. Theoretically speaking, increasing the supply of currency notes can lead to inflation. Many experts, from academia and industry, point to same examples where excessive paper money printing has driven countries into banana republics – Weimar Republic (Germany) in 1920s, Hungary 1946, Yugoslavia 1970s, Zimbabwe 2000s, and present day Venezuela.

But they have all got it wrong with the chicken and egg situation. It was systemic corruption which feeds into economic mismanagement that led to massive hyperinflation. As the value of currency shrinks, more currency needs to be printed and in higher and higher denominations. Germany had its 100 million mark notes, Hungary had 100 quintillion pengő, Yugoslavia had trillion dinar, Zimbabwe had 100 trillion dollar notes, and Venezuela has million bolivar notes.

In today’s world, a country’s money supply is predominantly in the form of digital money. Currency notes make up only a fraction of money supply. The discussion of impact of money printing basically refers to digital money.

As mentioned earlier, digital money is reflected in depositors’ bank credit balances. Central banks are governments’ banker. Thus if a central bank simply adds some credit to the government account out of nowhere, ie no transaction related, it creates money for the government. Every central bank charter obviously specifically bars this. Thus in reality, it is a fallacy to say government prints money to spend.

Note the US is unique in that it has no central bank. The Federal Bank System (Fed) comprises of 12 reserve banks which are privately owned by various member banks. The Fed is the government’s banker, but it is not a government agency. Although the government has certain interests and rights, the rights are not proprietary.

Central banks and Fed are tasked with managing the sale and purchase of government securities and monetary policies which are matters concerning quantitative money supply and general price level, or inflation, and by extension, employment. Central banks manage monetary policies of the government whilst the Fed executes the monetary policies of the Federal Open Market Committee (FOMC) which is a committee of the Fed member banks whose policies are made in the interest of the US.

Since governments do not print money to spend, where do the funds for deficit spending come from. Here we are not talking about various government agencies which in some jurisdictions are allowed to take on loans directly. We are referring to governments funding budget spendings in excess of revenue. This is done by issuing government securities (bonds). When investors buy these securities in the primary market, buyers remit proceeds to the credit of government accounts with central banks. By this manner, governments borrow to fund budget shortfalls. There is no money creation.

Singapore is unique in the world. It practices a balanced budget and never borrows for spending.

Well then, where is all this talk about about governments creating money to spend? 

Central banks manage liquidity in the market. When money is tight, there is an upward pressure on interest rates and exchange rates. Central banks pump money into the market, ie., central banks may loosen liquidity to stimulate spending which spurs economic activities and employment. This is done in open market operations where central banks purchase securities. Central banks pay for such purchases by simply crediting the seller banks’ Reserve Accounts. Thus central banks acquire assets with money they do not have. They simply create money out of nowhere by making a credit entry in seller banks’ Reserve Accounts. So now the banks have newly created money that can be used in the market. This is an exercise called QE for quantitative easing. Thus money creation via QE has nothing to do with government spending or borrowing.

Some take the macro or bird’s eye view that governments borrow to spend, which then central banks buy back through QE by simply creating money, is tantamount to governments creating money to spend. This notion is not correct as fiscal policies and monetary policies are entirely different affairs. Fiscal policies are managed by Treasury ministries who raise debt to fund budget deficits. Monetary policies are handled by central banks who perform QE to calibrate market liquidity and interest rates.

Thus a situation is created where central banks hold an asset and the governments hold a liability. It is a case of left hand owing to the right hand. In the case of US, the status is different since the Fed is not a part of government. In this scenario, governments do not fear the amount of debts they owe. They simply net off on maturity of the securities. However, doing so will reflect debit balances in governments accounts in central banks’ books. There is no literature on some creative accounting to resolve this. In practice this accounting conundrum does not seem to have presented itself as these securities have been rolled over with more and more new issues paying off maturing ones. Government debts keep pushing the ceiling.

On the other hand, the central banks have a liability for the securities they purchased as well as a valuation risk. When central banks simply credit seller banks Reserve Accounts for securities purchased, they have a liability for the money created. This liability is backed by the asset securities. On a going concern basis, central banks have no worry with the liability because as the money is circulated in the market, all that happens is just debit and credit entries in banks’ Reserve Accounts as money moves from one bank to another.

Most of these securities are government bonds which have no credit risks. Some jurisdictions have seen QE extend to central banks building balance sheet with equities. Bank of Japan is one example. In which case, credit risks exist. In the case of government bonds, market risks exists. With rising interest rates, bond prices tumble. Central banks' capital takes a beating from rising interest rates. With massive balance sheet build up from QE and rising interest rates, the Fed is now actually in negative capital mode if they recognise valuation losses, which they don’t.

There is another way that central banks create money out of nowhere. This happens during financial or economic crisis such as in 2008 and Covid pandemic. Huge sums of money are needed for bailing out businesses in financial distress or for financial aid packages. Central banks initiate bail out programmes, or governments push financial aid packages. For example, Fed had its Tarp, MAS has other various named programmes. These are basically loan facilities. When drawn down, central banks simply record the loan, and post a credit to the Reserve Accounts of the relevant banks. In this manner, unlimited sums of money can be created.

One more way central banks can create money, although indirectly. This is through fractional banking. Banks make money work for them. They take customers’ deposit and loan them out. The full deposit amount cannot be lent out. Banks must keep a certain balance in their Reserve Account in order to maintain liquidity to meet customers’ needs. How much to retain depends on the Reserve Ratio. Suppose the ratio is 10%, if a customer deposits $100 with Bank A, it can lend out $90. This $90 is deposited with Bank B which can lend out $81. This multiplier effect work its way through the market. Theoretically, a newly created $100 and a Reserve Ratio of 10% will end up with $1,000 increase in money supply. Central banks can increase money creation by fractional banking simply by reducing the Reserve Ratio.

Another way central banks create money is in its open market operations in the FX market. Central banks monetary policies are either based on tweaking interest rates or managing its exchange rates. Singapore is an exchange rate regime. Spot rates are volatile throughout the day. Most exchange rate regimes allow the rates to move within a certain band. When the rate is hitting the upper limits, central banks sell their currency to bring rates down. To settle, central banks simply credit the Reserve Accounts of the buying banks. Thus new money is created. Market intervention works both ways. Central banks buy their currency when the lower band is tested which is a reduction of money supply as seller banks Reserve Accounts are debited. Thus money creation can be netted off as negative or positive. A persistent pressure on the upper band means central banks are selling most of the time leading to more new money created. Since FX market intervention is to manage the exchange rate and not liquidity, this money created is nullified by a sterilisation process. This is done by central banks issuing Treasury Bills to mop up the liquidity caused by the new money created.

Governments rollover maturing bonds with new ones and add fresh borrowings. As a result, government borrowings have snowballed. The US national debt is now $35T. Is there no end to kicking the can down the road? This can continue as long as there is demand by investors for the $ bonds. That demand will disappear when the $ looses its role as world reserve currency. BRICS is working on developing an alternate currency to reduce dependency on $ in international trade. It is easier said than done. However, their success will mean the downfall of the powerful USD. All the offshore $ will come home to roost and the massive debt of $35T will need to be paid off as bonds mature, for they no longer can be rolled over as the market for $ bonds disappear. But the massive debt will not bankrupt the US. Any country with monetary sovereignty can always pay off debts in its own currency. The Fed can always credit bond holders' banks' Reserve Accounts. Simply create money $ to pay off debt. But the massive $35T created will drive the $ exchange rate to the ground and bring hyperinflation and deterioration to standard of living. It will impoverish Americans.

This explainer on money creation shows why even though the governments can print money, they still have to borrow. It also shows the fallacy of massive printing of paper money leads to high inflation, but rather, the reverse is true. Hyperinflation leads to massive paper money printing.

The generally held belief is massive money creation leads to high inflation. The past decade or so have seen central banks all over the world build up massive balance sheet in QE exercises, pursued on the belief that liquidity and cheap money stimulates the economy. Strangely, the massive QE have not resulted in massive increase in money supply and high inflation. This seems like one more fallacy but it's for another day.

Addendum:

To make this primer complete, there is one more way central banks create money, but it is a special situation that has no inflationary impact as the money will not be used.

Central banks arrange standby currency swap facilities with each other to provide liquidity for foreign currencies in the event of financial crisis. A swap deal is where one currency is exchanged for another at market rate (spot deal) and reversed at a future date at an agreed rate (forward deal).

For example say MAS has a USD/SGD swap facility with Fed. During a financial crisis where USD became difficult to source, MAS can provide liquidity to the market by availing the swap facility. MAS will buy USD from Fed against SGD say for 6 months. MAS pays for the USD by crediting Fed's account in SGD. Massive sum of SGD may be created this way but it has no effect on inflation because the Fed is never going to use those SGD. The Fed's SGD deposit will be reversed 6 months later when the forward deal matures.

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