Financial IQ: n ’13, PH growth may be second to China

World map showing GDP real growth rates for 2010. CIA world factbook estimateshttps://www.cia.gov/library/publications/the-world-factbook/rankorder/2003rank.html as of Januay 2011. (Photo credit: Wikipedia)

Financial IQ Philippines Quick Hit(s):

Good to hear experts seeing continuous growth in Philippines.


Among emerging economies in Asia, the Philippines will continue to trail China in terms of economic growth in 2013, according to a think tank based in Washington, DC.

Similar to a forecast it released in 2012, the c said in a new global report that Philippine growth would remain second only to that of China next year.

Also, the IIF said that in three years to 2014, yearly domestic growth of the Philippines would be above 6 percent.

The think tank said that the country’s gross domestic product would follow through with a growth rate of 6.8 percent next year after the latest forecast of 6.5 percent for 2012.

These are upgrades of IIF’s previous forecasts of 5.7 percent this year and 6.5 percent in 2013.

In 2014, the IIF predicts that the Philippine economy will grow slower at 6.2 percent, to be overtaken by India and Indonesia for second and third place after China.

“The Philippines stands out for its strong growth this year,” the IIF said. “Real GDP was 7.1 percent greater in the third quarter than a year earlier—up from 6.2 percent in the first half, and 3.9 percent for 2011.”

Also, the IIF observed that exports of electronics products—which “sharply depressed” total Philippine exports in late 2011—recovered early this year.

Latest data from the National Statistics Office showed that exports grew by 6.1 percent year-on-year in October, while electronics shipments was almost flat at 0.3 percent.

“The reduction in the budget deficit gave the government some fiscal headroom this year to stimulate domestic demand, while consumption continued to be buoyed by inflows from workers abroad,” the IIF said further.

The think tank also noted that remittances reached $17.3 billion in the first nine months of 2012, which was 5.7 percent higher year-on-year.

Regarding the peso, IIF expected it to trade at 40.90 against the US dollar by year-end, strengthening further to 40.80:$1 in 2013.

The local currency will be much stronger in 2014 when it is expected to trade at a round 40 against the greenback.

http://business.inquirer.net/99455/in-13-ph-growth-may-be-second-to-china-says-think-tank

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Financial IQ: PSEi up 33%

stock market (Photo credit: 401(K) 2012)

Financial IQ Philippines Quick Hit(s):

What is not to like about investing on the financial market?  This year... those who were invested on the Philippine Stock Market got a pretty nice return. :)


Philippine stocks surged for the fourth straight year in 2012, rising by about 33 percent this year on favorable macroeconomic and corporate performance.

On the last trading day of the year, the main-share Philippine Stock Exchange index gained 17.84 points or 0.31 percent to close at 5,812.73.

“Market ended the year way above our expectations. We closed today with a loud bang. It’s a vote of confidence of investors for the market’s sustained performance next year,” said Astro del Castillo, managing director at investment management firm First Grade.

“No doubt we will continue to hear a lot of fireworks for 2013,” Del Castillo said.

While there had been window-dressing on the last trading session of 2012, the stock market was described to have performed well for most of the year.

In fact, the index has been on an upswing since 2009, coming out of a global financial crisis the previous year.

In 2012, the local bourse was one of the best performers in the region, gaining 1,440.77 points from the end-2011 closing of 4,371.96.

Also, the market broke the index record 38 times this year.

“2012 was a good year for the stock market,” veteran stock broker and former PSE president Ramon Garcia said. “Investors are happy that the listed companies gave them reasonable returns on their money. Stock brokers too see their bottom lines on a positive note.”

Garcia, president of stock brokerage RTG & Co., added the PSEi could break out of the 6,000 level by January next year.

The 2012 closing level was not too far from the record finish of 5,832.83 posted on Dec. 26. The intraday peak reached 5,866.83 last Dec. 3.

Elsewhere across the region, stock markets were mostly higher on hopes that US officials would strike a last-minute budget deal to avoid a “fiscal cliff”—a series of tax increases and drastic spending cuts that could push      the US economy into another recession next year.

At the local market, value turnover for the day amounted to P7.87 billion, buoyed by yearend window-dressing. There were 101 advancers against 83 decliners, while 35 stocks were unchanged.

The biggest gainers were URC, JGS, Semirara, SMC, ALI, AGI, FGEN, EDC and AC.

BDO, SMIC, MWC and AP also contributed gains.

http://business.inquirer.net/99963/more-airlines-flying-to-ph-if-govt-scraps-carriers-tax-ftip-official

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Financial IQ: Firms still below PSE’s minimum public float

English: Phillippine stock market board (Photo credit: Wikipedia)

Financial IQ Philippines Quick Hit(s):

It is good to see our regulators implementing the Stock Exchange policy.  With stricter policies in-force... hopefully, the Philippine stock market can be an even better place for investors. :)


With two weeks to go before the ultimate deadline, 19 listed companies are still below the 10-percent minimum public ownership required for continued listing on the Philippine Stock Exchange.

In the last few days, some companies such LTG Inc., the holding firm of the Lucio Tan group, and the Gotianuns’ Filinvest Development Corp. have undertaken equity deals to comply with the requirement.

Based on a PSE report, among the companies with insufficient public float as of Dec. 18 were: Integrated Micro-electronics Inc., Alphaland Corp., Synergy Grid & Development Phils., Manchester International Holdings, SPC Power Corp., Vivant Corp., Atok-Big Wedge Co. Inc., Mariwasa Siam Holdings Inc., Southeast Asia Cement Holdings Inc., PAL Holdings Inc., 2Go Group Inc.,  Allied Banking Corp., Maybank ATR Kim Eng Financial Corp., San Miguel Brewery, PNOC Exploration Corp. and San Miguel Properties.

Three of the companies with insufficient public float are currently suspended from the PSE: Philcomsat Holdings Corp., Cosmos Bottling Corp. and NextStage Inc.

In the case of Ayala-led Integrated Microelectronics Inc., AYC Holdings Ltd., a subsidiary of Ayala Corp., has agreed to sell a portion of its stake to a public investor to enable IMI to remain listed. IMI expects the transaction to be completed before the year of the end, according to the company.

Maybank ATR Kim Eng is also expected to announce an equity placement deal to meet the requirement before the year’s end.

The last time the PSE announced the list of non-compliant companies, there were 25 companies. Two companies previously on the list—First Metro Investments Corp. and Metro Pacific Tollways Corp.—are set to be delisted by Friday while one, Eton Properties, is undergoing delisting procedures.

Immediately after December 31, the PSE will impose a trading suspension on the shares of non-compliant listed companies for a period of not more than six months, or until June 30, 2013. If after June 30 a listed company remains non-compliant, the listed company’s shares will be automatically deisted.

The Bureau of Internal Revenue, as contained in its recent rule issuance relating to the minimum public ownership rules, will impose capital gains tax and a documentary stamp tax (DST) on every sale, barter, exchange or other disposition of shares of non-compliant companies starting the first trading day of 2013.

A capital gains tax equivalent to 5 percent of the net capital gains amounting to not over P100,000 will apply while a 10-percent capital gains tax will apply on the excess. A DST of 75 centavos on each P200 of the par value of the stock will also be applied on the sale.

In contrast, trading of shares listed and traded at the PSE are subject only to stock transaction tax equivalent to 0.50 percent of the transaction value levied on the seller.

http://business.inquirer.net/98883/19-firms-still-below-pses-minimum-public-float-2-weeks-before-deadline

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Financial IQ: Electricity rates seen to increase in 2013

ERC 66208 (XFFB, 18.10.2008) (Photo credit: kbs478)

Financial IQ Philippines Quick Hit(s):

Philippines is already one of the countries that pays high electricity rates.  This is one of the reasons why some businesses have shut down because they cannot compete with the prices of other countries.  If electricity is your specialty, maybe you can invent something that can be cost effective for the residents and at the same time, earn significant profit. :)


Power consumers may have to brace for possible rate increases next year with the nearing approval of the petition of state-run Power Sector Assets and Liabilities Management Corp. (PSALM) to collect close to P140 billion worth of stranded debts and contract costs.

Francis Saturnino Juan, executive director of the Energy Regulatory Commission, has confirmed that the commission last week issued an order confirming that the case was ready for final deliberations after the completion of case hearings and other documentation.

“[This means that] any time after today, the case can be deliberated upon and resolved. We don’t have a definite timeline as to when this will happen. We are also cognizant of the fact that PSALM is urgently requesting for the resolution, but we are saddled with cases that are equally important,” Juan said.

Juan added that the ERC has yet to evaluate and deliberate the final amount to be collected from consumers and the length of the collection period.

Should PSALM’s application be approved, consumers can expect to pay another 36 centavos a kilowatt-hour over the next four years and a separate 3 centavos a kWh over a 15-year period to help pay the debts of another government firm, the cash-strapped National Power Corp. (Napocor).

The 36 centavos a kWh that PSALM wanted to pass on to consumers would cover the payment of stranded contract costs (through the universal charge for stranded contract costs or UC-SCC), while the 3 centavos a kWh would be used to settle stranded debts (through the universal charge for stranded debts or UC-SD). With the 39 centavos a kWh from the two charges, PSALM will be able to collect about 25 billion a year to help pay for its outstanding obligations.

PSALM president Emmanuel Ledesma Jr. earlier said that the government agency was hoping to start the collection of universal charges for stranded debts and contract costs from all grid-connected power consumers early next year amid rumors that the ERC would be releasing the decision by January.

PSALM, however, is hoping to collect the UC-SCC for a longer period of 15 years, instead than the current four years set by the ERC, to ease the burden on consumers.

Should the ERC allow PSALM to recover the UC SCC for 15 years, the additional charge would be equivalent to 6 centavos a kWh. This means that the total universal charges for both stranded contract costs and stranded debts will amount to 9 centavos a kWh over the next 15 years. At 9 centavos a kWh, PSALM will be able to collect an additional P5 billion from consumers yearly.

Ledesma earlier said that PSALM also wanted to extend its corporate life by another 10 years as this would further reduce the universal charge burden to about 6.5 centavos to 7 centavos a kWh over a longer period.

“Extending the corporate life of PSALM is not necessary but it would be nice because we’re trying to mitigate the impact to consumers—it will be for the benefit the consumer,” Ledesma had stressed.

PSALM has since been seeking to extend its corporate life to 2036, intended to mitigate the impact of the P140 billion in stranded costs on all power consumers.

http://business.inquirer.net/98469/electricity-rates-seen-to-increase-in-2013

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Financial IQ: Fund managers optimistic about ’13 prospects

Lehman Brothers Rockefeller centre (Photo credit: Wikipedia)

Financial IQ Philippines Quick Hit(s):

It is good that fund managers are bullish on the global economy for 2013.  Since global markets are interconnected... Philippines can still enjoy growth while major countries are experiencing growth as well.


Investment professionals across the globe are optimistic about global growth prospects for 2013, but they believe much work needs to be done to restore financial market integrity.

Based on the CFA (Chartered Financial Analyst) Institute 2013 global market sentiment, about 40 percent of respondents see an expansion in the global economy in the coming year, a six-point increase from last year’s poll.

But citing an overwhelming lack of trust in finance, CFAs stress the need to develop a culture of ethics and integrity inside financial firms.

“Mis-selling” of financial products topped respondents’ ethical concern locally. Mis-selling—or the pushing of unsuitable products to obtain a commission, or failure to provide advice tailored to the client’s needs—is seen as the most serious ethical issue in the coming year, according to 29 percent of members, up significantly from 13 percent last year.

In terms of asset classes, equities are still expected to outperform.

Half of respondents globally think equities will provide the highest expected total return in 2013, up from 41 percent a year ago—when compared to bonds, cash, commodities and precious metals.

Equity markets expected to provide the best investment opportunities in 2013 are the United States (32 percent), China (17 percent) and Brazil (10 percent).

The annual survey measured the opinion of 6,783 CFA charterholders and members across the globe.

“There is mounting optimism around global economic growth from both investors and the financial industry, despite ongoing issues like the European sovereign debt crisis and significantly greater concern about mis-selling,” said Kurt Schacht, managing director of standards and financial market integrity at CFA Institute.

“We’ve seen the industry become more vocal about the behavior that led to the global financial crisis, and survey respondents are emphatic about the need for stronger ethical culture at financial firms. Our members are convinced that to build a more trustworthy industry, change must start with top management to develop a culture where ethical practice is just as important as investment performance,” he said.

In the case of the Philippines, CFA Society of the Philippines president April Lee-Tan said the country’s impressive gross domestic product growth—together with relatively benign inflation—would put the country in an excellent position to capture more foreign direct investments in light of the improving outlook of the global economy.

“The drive of the current administration to improve governance has already enhanced investor confidence in the Philippines. However, we must ensure that the money coming in is channeled to the right sectors of our economy so that the most number of Filipinos benefit,” Lee-Tan said.

While 40 percent of CFA respondents expect the global economy to expand, only 20 percent believe it will contract, down from 29 percent a year ago.

Those in advanced economies (42 percent) are more optimistic than members in developing economies (35 percent).

The respondents are generally optimistic on local economies, except in Europe. Almost half (45 percent) of investment professionals think the economies of their own countries will expand in 2013, up slightly from 42 percent last year. By stark contrast, only 28 percent of those in Europe expect their economies to expand in the new year. Also, those in developing economies (56 percent) are markedly more optimistic than members in advanced economies (43 percent).

The survey also showed that ethical cultures and behavior within financial firms must change. More than half of respondents (56 percent) cite a lack of ethical culture within financial firms as the primary contributor to the low level of industry trust.

http://business.inquirer.net/98493/fund-managers-optimistic-about-13-prospects

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Financial IQ: Fewer households allot remittances for savings

Coins (Photo credit: Wikipedia)

Financial IQ Philippines Quick Hit(s):

Hopefully, households were able to find alternative investments that provided good returns... instead of just spending money on items/services for immediate gratification.  Remember to first set aside at least 10% for investment, and the remaining for expenditures.


The proportion of Filipino households that set aside remittances for savings and investments dropped in the fourth quarter from a year ago, highlighting the need to provide financial education to more people in the country.

The Bangko Sentral ng Pilipinas said that households dependent on remittances would need to learn how to save and invest the money they receive to secure their future and stimulate growth of the economy.

Results of the latest quarterly BSP survey showed that only 39.5 percent of respondents said they used a portion of their money for savings. This marked a drop from the 42.6 percent recorded in the same period last year.

Still, the fourth-quarter figure was better than the 36.8 percent recorded in the previous survey three months ago.

Results also showed that respondents who said they used a portion of their money for investments settled at just 3.1 percent. This represented a decline from the 6.4 percent registered a year ago, and the 4.9 percent of the previous quarter.

The survey was conducted in the first two weeks of October and had a sample of size of 478 households that regularly receive money from abroad.

The drop in the number of households that save up and invest the money received coincided with the current low-interest-rate environment, which led to shrinking yields on bank deposits and portfolio investments.

Economists said that in times of low interest rates, people tend to spend more of their money rather than save up or invest in fixed-income securities.

BSP Deputy Governor Diwa Guinigundo earlier said that if OFW households were to use their money to put up their own businesses, the multiplier effect of remittances on the economy would be much bigger. This is because, when one puts up a business, even a small one, he or she will create jobs.

At least 10 million Filipinos are estimated to be working overseas. Their remittances amounted to $20.1 billion last year. The World Bank expects remittances to the Philippines to rise to $24 billion this year, making it the third-biggest recipient next to India and China, with $70 billion and $66 billion, respectively.

http://business.inquirer.net/98477/bsp-fewer-households-allot-remittances-for-savings

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Financial IQ: Philippine stocks seen to weaken

English: Coat of arms of the Philippines (Photo credit: Wikipedia)

Financial IQ Philippines Quick Hit(s):

Were you caught off guard by this news?  Typically technical traders take profit when new highs are reached.  As far as valuation is concerned, some Asian countries have cheaper valuations compared to our stock market at this point.


Local stocks are seen continuing to pull back this week as many stocks have hit rich valuations while some external factors such as the US’ fiscal woes linger.

Last week, the main-share Philippine Stock Exchange fell by 87 points, or about 1.5 percent, to close at 5,707.11 on Friday.

Freya May Natividad, an analyst at 2TradeAsia, said the deadlock among US legislators on budget discussions depressed sentiment during the week, overshadowing the Federal Reserve’s pledge to buy $45 billion worth of treasury bonds a month and retain interest rates near zero levels until 2015.

“Momentum is likely to slow gradually as a prelude to holiday portfolio closing. Institutional players might be inclined to unwind some of their earlier buy positions to retain enough liquidity ahead of the Christmas and New Year breaks. With no firm compromise pact in place yet on the US fiscal deficit issue, some might be on ‘tentative mode’ unless positive surprises are announced,” Natividad said.

Over the long term, Natividad said funds flow would continue to favor high-growth emerging markets like the Philippines on supportive growth numbers for 2013. But after peaking at 5,866, she said the market might retest maintaining its poise above 5,700.

“Set against a healthy macro backdrop at home, gradually seize intraweek softness to position for 2013.  It might be timely to consider unnoticed shares per sector, especially those with promising yields,” she said.

Immediate support was seen at 5,650-5,700 and resistance at 5,800.

AB Capital Securities analyst Abbygayle Estrella said a temporary technical correction had restrained the PSEi. “Aside from the omnipotent shadow that the US fiscal cliff has cast over major markets, we do not foresee any catalyst that could reverse the ongoing correction of the local index.”

http://business.inquirer.net/98481/ph-stocks-seen-to-weaken

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Financial IQ: Philippines Next Investment Hotspot?

English: Coat of arms of the Philippines (Photo credit: Wikipedia)

Financial IQ Philippines Quick Hit(s):

The Philippine stock market is one of the best performing on the global financial market.  If you are a contrarian, you may want to guard your optimism and invest with more caution.


Amid growing investor confidence spurred by government and private spending, the narrowing trade deficit, and sound economic policy and fiscal management, investment analysts from Philam Life state that the Philippine Stock Exchange index (PSEi) has enough momentum to hit 6,000 points by next year.

In a recent press briefing at The Peninsula Manila, Junie Banaag, First Vice President & Equity Fund Manager of Philam Life, said that the PSEi has advanced better than other stock markets over the past two years.

“The PSEi’s 32% growth from 2010-2012 outpaces that of the S&P 500, the Indonesian and Malaysian Stock Exchanges, Germany’s DAX, and even the Dow Jones Industrial Average,” said Banaag. “Strong economic fundamentals and the Philippine government’s effective management of fiscal and monetary positions will fuel the growth of the Philippine market.”

Banaag also points out that the Philippines has “one of the fastest growing economies” in the region and the world as of late. He points to the 5.9% GDP performance of the country in Q2, which he says makes the Philippines the fourth fastest growing economy in Asia, trailing behind China, Sri Lanka, and Indonesia. Moreover, Banaag feels positive about the recent credit rating upgrades for the Philippines, and is excited about the country’s prospects of making investment grade in the near future, which he says will surely bring in fresh funds and more investors into the country.

http://philstar.com/business/2012/12/05/881011/philippines-next-investment-hotspot

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Financial IQ: Stock valuation

English: Growth rate of US average hourly earnings from 1989 to 2010 (Photo credit: Wikipedia)

Financial IQ Philippines Quick Hit(s):

If you are into Equities, here is a useful tip in determining stock valuation... especially right now, where Philippine financial market keeps on going up. :)


QUESTION: I have been planning to invest in the stock market but share prices have been rising quite fast that I find it expensive to buy now. I don’t want to rush into buying a stock then regret it later because I could not sell it at a profit. Is there a way for me to pick the right stock? Please advise—Hazel Cruz by e-mail

Answer: When everyone is chasing the market at increasingly higher prices every day, it is really difficult to buy stocks because you tend to make your investment decisions based on emotion rather than logic.

When emotions are involved, you tend to either buy on impulse because you want to earn quick money or not buy at all because you fear that it may be too late to get into the action.

Either way, unless you are born lucky, buying stocks based on gut feel alone always leads to losses.

But do not be discouraged if you cannot pick a good stock at this level when everything in the market seems to be expensive.

Actually, this is a good opportunity for you to take advantage of the strong market sentiment by buying stocks that have not yet reached their true value.

There are several approaches to valuing a stock.

The most commonly used is the Price-to-Earnings (P/E) ratio.

This ratio represents the earnings multiple that the market is willing to pay for a stock. You can compute this by dividing the current price of the stock by its earnings per share.

For example, to get the P/E ratio of PLDT, simply divide its share price of P2532 by its earnings per share of P175 to get 14.5x.

But getting the ratio itself doesn’t tell the whole story. You need to compare this to a similar stock, or the market average to know if there is still room for further upside.

If you compare the stock of PLDT to another telecom stock, you will see that it is less expensive than Globe, which has P/E of 16x.  If you compare PLDT to the market as whole, you will also find that the stock is cheaper than the market P/E of 18x.

Does this mean that when a stock’s P/E is at par with market average, it is not a good buy anymore? It depends.

As a guide, it only indicates that further appreciation of stock price based on P/E valuation may be already limited and you may be already paying too much so you better watch out.

In general, stocks that are considered expensive by P/E comparison may eventually fall because investors will begin to take profits by selling them down.

But there are exceptions. There are some stocks that command a certain premium because the market is simply willing to pay more for them.

For example, Ayala Land has P/E of 36x, twice the market average of 18x. Jollibee also has P/E of 30x. SM Prime Holdings has P/E of 28x.

There are many reasons why some stocks are worth paying more for. It can be market dominance, track record of management or strong earnings prospect of the company in the future.

One way to justify paying for high P/E is through the use of P/E to Growth ratio or simply known as PEG ratio.

This ratio assumes that some companies deserve to have high P/E because of their high earnings growth rate.

You can compute the PEG ratio by simply dividing the P/E ratio with the company’s expected growth rate.

Normally, PEG ratio of 2.0 and above is considered expensive. The lower the PEG ratio, the better.

To demonstrate, using the same example above, Ayala Land may have high P/E of 36x but its expected earnings growth rate is 24.8 percent, so if you divide its P/E by its growth rate, you will get PEG ratio of 1.45x.

If a PEG ratio of 2.0 is considered the limit, then these two blue chips absolutely have more room for upside.

Now that you know how to value a stock using earnings data of the company, be aware that making an investment decision should not be based on P/E valuation alone.

It is important to look at the qualitative factors such as the quality of earnings, and management credibility.

This is because the earnings that you see in the financial statements which you rely on to compute for P/E and growth rates may have been manipulated through the use of creative accounting.

You may not have the skills to detect potential fraud in the financials, but at least you can comfort yourself by dealing with people with integrity from the management.

http://business.inquirer.net/96597/how-do-you-know-if-a-stock-is-expensive

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Financial IQ: UBS hikes Phl growth forecast

English: UBS Investment Bank's Offices at 299 Park Avenue (Photo credit: Wikipedia)

Financial IQ Philippines Quick Hit(s):

It's always a good sign when overseas financial institution recognizes a country's economic development and potential. :)


The Union Bank of Switzerland (UBS) has revised its economic growth forecast for the year to 6.3 percent from its previous projection of 4.5 percent.

The 6.3 percent is above the government’s official target of five percent to six percent for 2012.

In revising this year’s growth projection, UBS said it took into account the stronger-than-expected growth in the third quarter of the year of 7.1 percent.

In a report, UBS said that if this year’s growth surpasses six percent, it would be only the sixth time since 1980 that growth exceeded six percent.

“Philippine real GDP growth has only surpassed six percent five times since 1980, in 1988, 1989, 2004, 2007 and 2010,” UBS said in a report titled, “Philippines by the Numbers.”

However, despite the strong third quarter growth, UBS said that its growth forecasts for 2013 and 2014 are expected to remain unchanged.

“We forecast real GDP growth of 4.5 percent in 2013 and 4.9 percent in 2014. Investment growth, we expect to outperform. Our 2013 and 2014 real GDP projections are essentially unchanged despite the stronger than expected growth in the third quarter of 2012,” UBS said.

The Switzerland-based bank said that although trade is expected to improve next year, the improvement may not be enough to spur strong growth.

“We expect an improvement in trade growth during 2013, lead indicators of trade activity and domestic activity suggest the tail end of the year may be a little below par,” UBS said.

Furthermore, UBS said the government must come up with plans to boost growth and support investments.

“Also in tune with the region, a combination of government plans and low interest rates should come together to support investment growth,” UBS said.

At the same time, the investment bank noted the Aquino administration’s efforts to improve governance and push for higher sin taxes.

“We remain positive on the Philippine economy. A pick up in investment activity would be a plus for future growth. Also potentially positive are the government’s reform efforts. We note the anti-corruption drive, a bill to raise sin taxes and the movement towards a peace deal in the southern Philippines,” it said.

However, UBS cautioned the government against delays in spending, saying that this could dampen growth.

“The risk we identify is that spending programs may be delayed and fiscal policy remains relatively tight,” it said.

http://philstar.com/business/2012/12/11/884492/ubs-hikes-phl-growth-forecast

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Financial IQ: No instant successes

Live video feed of Zig Ziglar speaking at the Get Motivated Seminar at the Cow Palace in Daly City, California. (Photo credit: Wikipedia)

Financial IQ Philippines Quick Hit(s):

Success is a journey.  Even SM tycoon Henry Sy and Manny Pacquaio worked their way to the top.


The world lost a great man when famous motivational speaker and author Zig Ziglar passed away last week at the age of 86. As an ode to such a great person, let me share with you his notable thoughts on “overnight success.”

“Many times an unknown person does something spectacular and suddenly becomes a ‘hero,’ a public figure, an ‘overnight success,’ the object of much envy.” Let’s explore this ‘overnight success’ syndrome.

“Several years ago, Gary Spiess from White Lake, Minnesota, did an incredible thing. He sailed his 10-foot boat across the Atlantic Ocean in just 54 days. Most of us can only imagine what he endured to complete his 54-day ordeal, but suddenly the whole world knew who he was.

“What is the real story? Did he just have a good idea, implement it and “luck” into celebrity status? The reality is that, Gary had worked, planned, sacrificed and studied for three years to build his boat. He committed not only his money but 100 percent of his spare time for three solid years. He had to chart his course and plan every detail, down to the minutia – including maximum use of his space and the proper food, clothing and water to carry. Once the trip began, so did the danger. The most dangerous and difficult part was fighting the violent seas of the Atlantic Ocean. The seas often combined with a driving, bitterly-cold rain, which chilled him to the bone. By the time he reached England, he was so brutally battered by the cruel sea that his entire body was black and blue. Yes, it’s true he had his day in the sun, but it’s safe to say that he had sacrificed and worked in order to receive his rewards. 

“Most of us are not interested in doing anything of that nature, but it is safe to say that if we’re going to accomplish anything of significance, and particularly if we’re going to maintain that significance, long hours of planning and even more of hard work are required. But it’s also safe to say it’s worth it because the effort is temporary but the satisfaction and rewards can be long-lasting.” 

There is no such thing as instant success. Champions aren’t made on the day of the game. That’s simply the day when the world recognizes all the preparations that took place before that day arrived.

Adoring crowds and television cameras aren’t usually around when Champions are being made. They’re made in the early morning hours when the rest of the world is sleeping just a little bit longer; in the late evening hours when fatigue has overtaken the average person and sent him to bed. Champions are made in the thousands of little ways that they discipline themselves to do the things that everyone could do, but most people won’t.

It has taken me many years to learn that none of the “big” things I’ve done have helped me to succeed. Instead, it’s all of the little things that I did over and over. For example, the discipline to plan each day’s work the night before, no matter how tired I was, has had more to do with my success than any “big” thing I’ve ever done. Not a “big” thing, but a necessary thing in getting ready to win.

Former heavyweight boxing champion of the world Muhammad Ali said, “The fight is won or lost far away from witnesses – behind the lines, in the gym, and out there on the road, long before I dance under those lights.”

Same thing in the Christian life. It’s not those big moments that make you saintly. It’s those tedious, mundane things that you constantly and consistently do well that prepare you for big successes in the coming days.

Be faithful in the little things, then you can be handed the bigger things. Prepare. Work hard and be diligent. And always remember that it wasn’t raining when Noah built the ark.

http://philstar.com/business/2012-12-09/883529/no-instant-successes

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Financial IQ: Implication of little Financial education

Securities and Exchange Commission (Philippines) (Photo credit: Wikipedia)

Financial IQ Philippines Quick Hit(s):

The past few weeks, Aman Futures have been getting top billing.  This is a proof that having "none" to "little" financial education is much more expensive than equipping ourselves with the proper financial education.


Aside from the numerous syndicated estafa charges they are facing, the top officials of Aman Futures have been slapped with complaints by the Securities and Exchange Commission (SEC) for engaging in fraudulent transactions and operating without the proper registration.

The Aman executives were charged in the Department of Justice (DOJ) with violating Sections 8 and 26 of Republic Act No. 8799, the Securities Regulation Code.

This as another syndicated estafa complaint was lodged against Pagadian City Mayor Samuel Co, his wife and 16 others also in the DOJ, this time by 22 complainants in connection with their alleged involvement in the investment scam perpetrated by Aman Futures.

The SEC complaint was against Aman Futures Group Philippine Inc., Manuel Amalilio and six members of its board of directors for being behind a massive investment scam that duped 15,000 people out of P12 billion.

Aside from Aman Futures and Amalilio, also charged were Fernando Luna, the former janitor and driver turned manager of Aman, Leilan Gan Lim, Eduard Lim, Naezelle Rodriguez, Wilanie Fuentes and Lurix Lopez.

Registration required

Section 8 of RA 8799 provides that securities shall not be sold or offered for sale or distribution within the country without a registration duly filed and approved by the SEC.

Section 26 says that it is “unlawful for any person, directly or indirectly, in connection with the purchase or sale of any securities to employ any device, scheme or artifice to defraud, obtain money or property by means of any untrue statement of material fact… and engage in any act, transaction, practice or course of business which operates or would operate as a fraud or deceit upon any person.”

The National Bureau of Investigation (NBI), meanwhile, filed Thursday a second complaint against Co, his wife Priscilla Ann Fernandez Co, Gan, Lim, Fuentes, Rodriguez, Lopez, Isagani Laluna, Abigail Pendulas, Paige Yabanez Madarang, Cheryll Mayoll Casinillo, Nimfa Caballero Luna (Luna’s wife), Dhurwin Weceslao, Haidee Alfanta, Cecille Abarquez and several John and Jane Does.

Amalilio and Luna are in hiding while the five directors are in the custody of the NBI after they surrendered last weekend.

The new complaint was filed by 22 persons, some of them agents of the investment firm.

In a related development, four companies allegedly engaged in a multimillion-peso Ponzi scheme have shown up on the police radar after some people complained about the investment firms, the Criminal Investigation and Detection Group (CIDG) said Thursday.

In an interview, Superintendent Benjamin Acorda Jr., chief of the CIDG’s Anti-Fraud and Commercial Crimes Division, said officials of the companies had been able to entice investors by promising them instant cash incentives and quick returns on their investment.

http://business.inquirer.net/95849/sec-files-fraud-raps-vs-aman-top-execs

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