the phil peso now reaches P49.10 level for one US dollar..

its not always good news when the peso is gaining strength against the dollar.

^yep, right. (sabi rin ng eco teacher ko ).. but di naman nakalagay "GOOD NEWS: peso.. for one dollar". hehe. however, a lot of good things happen too when the value of peso goes up. bababa ang presyo ng basic goods and services. our money can have more purchasing power. saka indication that there IS improvement in our economy. and that's one thing for the world to see.. on one hand, yung OFW remittances hindi naman affected masyado since hindi rin naman naghihikahos ang dolyar kahit tumaas ang piso..

we have fully paid our debt to IMF.. salamat naman.

now, the government will borrow from local industries for its funds..

theres this great tendency to make people believe that it is always good news, plus the way it is sensationalized in the news.

im hoping it really trickles down to the masses, so that they can say too that our country is gaining ground.

sooner or later, it will!

just learn to wait..

"Life is waiting."- The Terminal

ok lang mag-wait. pero how long?

yun ang problema ng mga isang kahig isang tuka, hanggang kailan pa? eh arawan lang sila namumuhay?

pero as ive said before, its better to bite the bullet now for the next generation na lang ang benefits.

and oh, malapit na rin ang elections...

sorry to butt-in... but yeah i totally agree with you. kung lumakas man ang peso ngayon at humina ito bukas hindi naman mararamdaman ng ordinaryong mamamayan ang epekto nito. Unang-una di naman bababa ang presyo ng bilihin over night at hindi naman nasa dolyar ang bilihin natin. the filipino people earn and spend in peso, so what will really matter to us filipinos is to know if you can still buy a decent meal out of your the peso that you earned at hindi lang puro noodles o de-lata na sardinas.

I read an interesting quote in the newspaper today: ”Good things come to those who wait, but these are the leftovers from those who hustle.”

While ordinary Filipinos are being asked to wait, a few unscrupulous special interest groups are not paying the right taxes, overcharging for gov’t contracts, cheating on regulations and employee benefits and diverting gov’t spending to favor their business interests. If these special interest groups don’t need to wait to have their fill, why should ordinary Pinoys? Furthermore, problems tend to accumulate and mestasize if they are not solved immediately. For example, women who receive insufficient education and are therefore less employable also tend to bear more children. It’s been 20 years since EDSA-1. That’s about two-thirds the time it took Korea to develop its society. Things have gotten worse in the Philippines since then. The public education, hospital and pension systems have deteriorated and citizens have been forced to cover for these costs out of their own savings. How much longer do people have to wait, especially since there is no tangible evidence that things will get better (except with people who assume in blind faith that a booming stock market and favorable exchange rate will automatically translate to benefits for the majority)?

so anong dapat mangyari? stagnant ang peso? bumaba ang value?..
& what do you think should happen para
a)bumaba ang presyo ng mga bilihin overnight?
b)filipinos will be able to buy a decent meal?
c)makaramdam sa ekonomiya ang mga ordinaryong mamamayan?

..umulan ng ginto?

what's the puckered brow for? let's be happy that on one view, there's an improvement in our economy.. i tell you, the progress of the peso is good for the philippines. i assume you won't say no.. hehe, i hope you get my point.

^ sana kung pwede nga umulan ng ginto! kahit piso-piso lang pwede na.

whats more important, at least for now, is that we improve the system here in the country. as what rabbaddal said, there are special interest groups who are so selfish. it goes the same way, improve the system and discipline the people.

i guess, the main reason behind increasing the VAT, is because the government cannot collect 100% of the taxes. according to the BIR sometime last year, they were only able to collect 78% of what was supposed to be collected. where are the rest?

yes of course, who doesnt want a better economy? pero i bet even though the exchange rate goes down to 44-45 within the year, the price of instant noodles remains at 5.50.

^the revenue collection actually improved in 2006.

noodles! wah.. the prices of most commodities here in the philippines are way cheaper than in other countries! kung sa US yan, baka magwala siguro yung nanay ko. and prices are expected to inflate annually. if it remains in that price, then good. ..mura pa rin ang noodles!

^ then good!

mahal na yan kung magsurvey ka ng mga D and E. at sawa na rin sila sa puro noodles, kung kaya masigasig ang mga instant noodles na magkaroon ng iba't-ibang flavors.

yun pa, expected to inflate annually, yung sahod di naman tumataas.

^hands off na ako diyan.. ang mga kompanya na ang may sala niyan.

yung sa noodles, ngayon nakakapili pa pala ang mga "naghihirap" daw.
sa gutom, lahat masarap!

yun na nga eh. precisely

at based pala yan sa product test. parepareho lang naman 5.50, eh di may choice ka.
at marami pang iba tulad ng:
kaya nga nagkaroon ng chilimansi kasi based din sa research, bibili ng dalawang pancit canton, isang with calamansi at isang hot and spicy tapos pinaghahalo.

Masyadong mababaw kung basta-basta nalang tayong magpo-post ng balita samantalang sa kabuohan, hindi gumaganda ang sitwasyon. Gaya ng pinost ng iba dito, ang mataas na peso ay hindi parating nakakatulong sa ekonomiya natin. It could make our exports more expensive, especially since the Philippines depends on the export of services in the BPO sector to create jobs. Also, GDP growth was mainly driven by remittance-induced consumption. A higher exchange rate (along with a declining US dollar value globally), could discourage overseas Filipinos earning in US dollars from remitting money back home in the long term. Hindi basta makakaramdam ng improvements sa buhay ang mga ordinaryong mamamayan dahil lamang sa halaga ng Peso; it’s not always good for the Philippines. Lots of other factors need to be considered before you can say “yes” or “no”.

Furthermore, it’s naïve to think that prices of commodities are “way cheaper than in other countries” like the US. Even if prices in the US are higher in terms of absolute value, Americans have more wealth in their hands than Filipinos so they can better afford these commodities. They worry less about necessities like attending elementary and high school, social security and health care reimbursement which are all generously subsidized by the state. Samantalang sa Pilipinas, binabayaran ang mga ito ng mga ordinaryong mamamayan sa ibabaw mg buwis na binabayaran nila. It’s OK for the absolute value of prices to go up for as long as living standards go up as well.

I’m not sure about the noodles in particular, but if CPI changes by a positive number year-to-year, then one would think that the price of noodles will go up as well. Maybe by 4% instead of 6%, but it’s still destined to go up over the long term. Noodles don’t tell us the whole picture though. Even if the price of noodles goes up or down by a little bit every year, it is negated by the high cost burden of education, health and pension costs. These costs have also gone up by much higher rates, which are not reflected in the change in CPI.



This “improvement in revenue collection” was mainly due to the expansion in the VAT. Billions more are lost every year when businesses don’t declare the right taxable income, claim the wrong tax benefits or lobby for misguided tax incentives (ex., attempted tax incentives for 3G). So what’s lacking in the big picture? The tax burden is not being fairly shared by all. It’s the ordinary Filipinos who shoulder more in terms of their ability to pay. They are also underserved since there are no apparent improvements in the quality of public education and healthcare and social security benefits. There are plenty of things that have to be considered first before we can say that something is really “good news”.

ditto!

tapos magrereklamo mahal? hehe. parang it's ridiculous to have 2-peso instant noodle packs in supermarkets.. pero why not? baka masiyahan na tayong lahat.

this isn't right.. choose: the peso value goes up, stays at its rate or goes down?.. you're frowning about the peso going up. staying at its rate is not a good thing either, since many people say "hay ang baba ng halaga piso kumpara sa dolyar!".. so which should it be then? dapat ba mapunta sa 60-level? i suppose you don't like it to happen too..

guys, there has to be at least one thing that's good. and the value of peso going up is definitely one thing to be happy about. i don't regard it as an absolute solution to the nation's economic crisis. but i believe it is no less than a vital step to attaining reforms in our economy, and that's what you want.

add: peace to all!

/\/\

No, you’re the one who’s not being right and obviously you didn’t read and digest my post. Otherwise, you wouldn’t be saying that I’m “frowning about the peso going up”. Let’s go back to what you posted:



Financial markets don’t work like “deal or no deal”. You can’t say for sure at this point whether things will turn out good or bad. Kung naintindihan mo yung sinabi ko, dapat klaro sa iyo na maraming “it depends” bago mo masigurado kung positibo o negatibo ang effect ng pagbago sa exchange rate. By saying that people have to “choose”, it shows that you don’t understand how the markets work. Alam mo ba, isa sa mga dahilan kung bakit nagka loko-loko yung ekonomiya ng Argentina ay dahil naging 1:1 yung peso-dollar exchange rate nila at naging mahal yung mga exports nila kumpara sa mga exports ng ibang bansa? Their main export was beef and their high exchange rates made their beef more expensive compared to Australian or Brazilian beef. Alam mo rin ba, noong isang linggo, nagpatupad ang central bank ng Thailand ng capital controls dahil nag-taas ang halaga ng Thai Baht? The Baht's appreciation made Thailand’s exports of manufactured consumer goods less competitive compared to those of China and Vietnam. What’s one important thing that Argentina, Thailand and the Philippines have in common? All of those countries have key sectors that export, the prices of which get affected by changes in the exchange rate. Argentina exports beef. Thailand exports manufactured goods. The Philippines, BPO services (in addition to remittances from US dollar-earning OFWs). All kinds of variables come to play: timing, current structure of the economy, global trends.

That’s why I said: lot’s of factors need to be considered before you can say that “progress for the Peso is good or bad for the Philippines”; and often, people won’t know what will actually happen until the good or bad effects have taken place. Those who understand an iota about exchange rates aren’t shallow enough to say “choose” on something as complex such as this at this point when things aren’t clear yet.

Lastly, a positive peso isn’t a “vital step in attaining reforms (ie, overall development)”. If you want to find a step towards attaining something vital, see my post regarding tax collections.

wala naman akong sinasabing nagrereklamo sila. nagsasawa na nga sila kasi sa abot ng kanilang makakaya, isa sa napaka onting choices meron ang mga mahihirap na mabibili. kung kaya't ginagawa nilang paghaluin yung ibang flavors.
at speaking of 2 peso noodle packs, hindi malayong mangyari na iyan. meron nga 2 pesos na isang hiwa ng butter sa sari-sari store. nasa cash outlay kasi iyan. immerse yourself and learn more. anyway, marketing na ito. off topic na.

balik dun sa exchange rate, sana lang hindi kasi induced by the OFW remittances (gaya ng sabi ni rabbaddal) kung hindi sana may mga foreign investments pa na mas makabubuti.

rabbaddal:

how clever. honestly, i consider your points more seriously now.

with regards to one of the negative effects of the improving exchange rate of peso to USD, the government said it will definitely act in maintaining the economic balance in export industries- exactly one of your subjects. that' s according to yesterday's news.

by the way, thanks for clearing things up.

this is getting soupy. hehe, wala bang price control dun? para at least, medyo decent naman ang perception sa product. example, damit na P10. di ka bibili kahit super mura kasi parang wala nang quality sa price pa lang. binabagayan sa product & manufacturing. kung magkakaroon ng 2 pesos na noodles, mas mahal pa ang lollipop nun.. anyway, magulo na nga.

siguro nga ang dami ko pang kakaining bigas.



nagdedecline ang halaga ng dollar sa world market.. sana nga..

I'm not sure what precisely the gov't said it would do to "maintain economic balance" in that report you read, and the phrase is a very loose term. The only way to "maintain economic balance" in the currency markets is to let market forces take its own course, at least in principle. There's not much gov't can do in that regard. For example, gov't cannot force foreign buyers of Philippine exports to buy our products at a higher price. Gov't also cannot force OFWs to remit money if they don't want to. Movements in exchange rates are market-driven. That also goes for the good or bad effects that result from those movements, which will occur as natural reactions. BSP has consistently maintained that it will not intervine in the Peso's movement whether the value goes up or down. But that's all understandable, because gov't and its affiliated institutions aren't supposed to intervene in the currency markets anyway.

At the end of the day, nobody knows for sure what will eventually happen should the Peso appreciate (or depreciate) further. You can't really tell if it's good news or not at this point. I wouldn't be so fixated at the exchage rate though. Like I said, it's not a vital step towards becoming a fully-developed society and it's not government's job to immerse in its movements. Take Korea, for example. It's currency has gone down and up drastically over the past 10 years. But that didn't hinder its gov't from running one of the world's most effective public school systems, which helped Korea develop the human resources it used to become the high-tech economy that it is today. You can't control the movement of exhange rate and its effects. But you can control how taxes are collected and spent.

^thanks for expounding further on the issue.. you mean, there's really nothing our government can do to somewhat reverse the negative consequences brought by the progress of the peso?? what are the specific actions that can be carried out by the business sector or by the nation as a whole, that will help prevent such economic troubles?

perception na lang iyon. ganun naman ginagawa ng marketing sa mga utak natin eh.

What I said was that the government cannot directly intervene in the markets. That’s why the notion that government will “maintain economic balance” is a contradiction. Maintaining economic balance means letting markets take their own course without government’s direct influence, regardless of what the immediate adverse effects may be. For example, if the peso’s appreciation makes Philippine exports more expensive and leads to some job / job opportunity losses or lower wages in exporting industries, eh di sorry nalang. The Peso’s appreciated value is the “balanced” value. Goverment will not give subsidies to exporters so that these exporters can continue selling their products at cheaper prices. Subsidies and other forms of direct intervention go against the principle of free markets (some countries intervene in specific cases, but that is another story).



That’s why I said that you shouldn’t be too fixated with the exchange rates. For one, its movement is generally beyond government’s control. Furthermore, there are other things that have a more profound effect on the lives of ordinary people that the government (and subsequently, the voters) has control over. Go back to my example about education in Korea. We all know that education is a stronger determinant of a person’s economic status than the exchange rate of that person’s country. Over the years, Korea’s government built one of the world’s most effective public school systems in terms of quality of learning, especially in math and science. When their currency collapsed, Korean students didn’t drop out of school. Instead, they stayed in school and became more skilled. Their need for good education was taken care of kahit ano pa ang nangyari sa exchange rate nila. Tipid pa sa tuition. Korea also upgraded its public healthcare system, para kung magkasakit ang mamamayan nila, makakapag-pagamot sila ng matino at mura kahit mababa ang sahod nila o mawalan sila ng trabaho. Currency fluctuations for them have become more of a nuisance instead of big trouble.

In the Philippines, families who earn enough have to send their kids to private schools and pay expensive tuition and other fees. They cannot trust the public school system to provide good education. Yun nga lang, pag nawalan ng trabaho ang magulang, minsan kailangan tumigil ng pag-aaral ang mga anak. O di kaya, nagtitipid sila sa mga ibang gastusin para lang makapag-bayad ng tuition at private health insurance. An appreciating / depreciating Peso won’t matter much to them since they have to carry huge private financial burdens to meet their most important needs.

As for businesses, they have to pay the right taxes and benefits to their employees. They also have to comply with environmental standards. Of course, they won’t do these things if they can get away with it. That’s why tax, labor and environmental laws always have to be enforced. This (enforcement) too is government’s turf.

sayang kulang talaga sa enforcement.

by march, balik daw sa P1-$50 ang exchange rate..?

wow sobrang lumakas na ang piso niyan! 1 peso to 50 dollars!

hindi ko lang alam talaga kung masasabi na talaga iyan.

good news na ba yun categorically?

/\/\

Let's imagine that (P1 = $50) really happened. Maybe it's not good for business if it happens over a very short period, like by March. Businesses are still programmed to operate under a strong, but fluctuating, US dollar value. In addition to that, other currencies like the Japanese Yen could have also gone way up against the dollar. The US is still one of the Philippines' most important trading partners and our exports could become more expensive compared to American-made goods. Also, exports of our other trading partners (like Japan) to the US could also become more expensive compared to American-produced goods. If it affects the business climate of our trading partners, it will eventually affect the Philippines. For as long as the US accounts for one-fifth of the world's consumption, a sudden drop in the value of the dollar will rattle the business climate in other countries, especially the ones that depend on exports.

^ question lang?

what if mangyari talaga iyon, then siguro magkakaroon naman ng shift ng demand, due to purchasing power? kahit siguro population-wise, malaki ang US, but what if may pera na mga pilipino, hapon, chinese and other countries if it were really true na 50 pesos is to 1 dollar. baka umuwi lang mga OFW. haha! so baka magiging less significant na ang US at baka hindi na rin sila 20% of world consumption..

^the same thing that bugs me..

can't we live without the US & its dollar?

we can! pag tayo na yung superpower??

actually, based sa statistics na ng mundo, kaya natin patigilin ang pagtakbo nito. dahil 45% ng halos lahat ng mga important sectors, pilipino ang nagtatrabaho.

naisip ko lang, welga tayo and we pull back every filipino working abraod, tigil ang buong mundo.

haha.. tigil din ang buhay ng ating mga kababayan..

pero kung kaya ang global dictatorship, hehe. awkward nga lang.. imagine, elfin Mrs. Arroyo in the position.. was that your idea?

nope. my idea was that other countries would beg (kneel before us) to come back to them and work for them. haha! di naman sila supposed to be uunlan without us!

and that is when we dictate what happens! haha! getting off-topic.

oh will they?.. opportunist na impression sa atin nun.. bakit, hindi ba? hehe..

In theory, it’s possible. But like I said earlier, businesses in exporting countries are programmed to sell to the US. It could take a very long time for businesses to adjust to the sudden loss of American demand. Factories / facilities have already been built and business models engineered around US demand; cultures have also been developed. For example, Filipinos typically save more of their income than Americans. Don’t expect them to change their attitudes all of a sudden and see them start buying the same goods at the same quantity that Americans used to buy. What happens if businesses suddenly lose their biggest customers? They either lay off people or at least stop hiring. Kung magyari ng sabay-sabay iyan sa Pinas at a time when the poor in the Philippines are getting poorer and the middle class are stretched, the political climate could become unstable and the stage could be set for a downward spiral.

^ haha i see. thanks.

it was only based on the assumption that the peso strengthens over the dollar by march of this year. hahaha!

sorry, my bad.. mali pala ang news.. i've interchanged yung figures sa units by mistake.. so it should have been P50=S1.. sorry again..

^ toink! ngayon mo lang napansin??!

akala ko ganun. mali pala.. masyadong naging thrilled sa news.. sensya, tao rin.

ayos lang. tao rin kami!

sayang tuloy analysis niyo.. hehe. anyway, it did make sense kahit papano..

kaya nga based doon sa "hypothetical" situation na binigay mo ang "analysis"

na super unrealistic..

well it is not impossible but highly improbable. malay lang natin.....

sige. sana $100=P1 na lang. haha.. para stretched ang analysis.

oh well. back to reality..