Latest SGX 'hollowing out' is different - and troubling

"A BIG problem the Singapore market faces is the hollowing-out effect created by the failure of the market to operate as an efficient pricing mechanism. Because stocks persistently trade at undervalued levels, there is an incentive for major shareholders or corporate predators to step in, pay off shareholders, and take the company private.

"This phenomenon has been gaining momentum in the past 18 months, and although it leads to short-term bursts of interest because of the takeover speculation generated, it leaves the market worse off in the long run."

This may come as a surprise to some readers but although the above assessment could well apply in today's market given the in…