Logical fallacy: Appeal to emotions
This fallacy is committed when someone manipulates peoples' emotions in order to get them to accept a claim as being true. for more detail, see here
don't string me up and shoot me. i know that money matters are sensitive, especially if one feels victimised. over and over again, we have been bombarded with media coverage of investors of the doomed Lehman Minibonds. much of the focus is given especially to retirees who have lost their life savings, and yesterday's Newpaper featured a partially paralysed man who was counting on this investment to see him through for the rest of his life.
of course these people need help, and considering all the public attention lavished, there is no doubt that DBS and all other banks would bend backwards to cater to their needs.
but it is another matter saying that they deserve compensation because of their failed investment. if a product pays anymore than a fixed deposit, naturally, it carries a higher risk than one that pays less. how can there be such a thing as a free lunch? to be frank, isn't the higher profit the very reason why one would take more risk? the worst doesn't usually happen...but this month, it did.
of course it is painful to lose money, especially in huge sums. but this doesn't mean that the banks have the legal obligations to compensate the investors. in fact, i thought that if they do, it actually undermines the integrity of the laws that govern investment, because it means that even legally-binding contracts, aka the fine print, can be overturned if there is sufficient public outcry. let us not forget that these laws exist to protect not just the banks but also the investors, and a spirit of fair play is necessary to ensure that both parties continue to transact freely, without the fear that the contract would be breached.
this doesn't mean that we leave the needy in the lurch, and tell them, 'just too bad'.
the banks could, and should extend them help out of goodwill, as part of their social responsibility. let those within the category of 'vulnerable investors' appeal from this angle, and receive all the help that they need. and let this help be generous and big-hearted.
at least, in my point of view, this would be the more legally logical solution.