Is the worst over?

[pigdog]

check out this video footage at MSNBC and make your own conclusion. one thing for sure, we could use so good news for a change!
http://www.msnbc.msn.com/id/21134540/vp ... &#27159890

[pigdog]

here some more lets keep our fingers crossed!
http://www.msnbc.msn.com/id/21134540/vp ... 6#27162106

[AudioAmp]

I dont mean to sound negative... just realistic but we are not out of the woods yet.

Financial system collapsed = tighter money and availability = businesses going down due to cash flow constraints = layoffs = lower consumption = more businesses going under and the cycles goes on and on until the weak are eliminated.

Unfortunately the Philippines seems shielded from the full effect for the global recession up to now. Next year will be tough... so so tough since our economy to a large extent is still dependent on the US and its consumption is going down.

I do hope that the recession while deep wont last too long.

Just my personal view but i am bracing for the worse...

[rtsyrtsy]

I'd still play it conservatively personally...delaying major purchases, maximizing cash flow.

The mortgage meltdown is potentially just the first tsunami as Greenspan calls the recent events. Business Week wrote a couple of weeks ago about the potential second wave--credit card defaults resulting from job losses, lower credit limits, etc. Thank heavens oil prices have softened so that should help many people especially as the northern hemisphere goes into winter.

In the long run, who would say how big government, i.e. a government that has significant equity in the private sector, will behave when their holdings are up? On one hand, they can get out of the private sector by cashing in then using the proceeds to fund healthcare, emptied retirement nest eggs, renewable energy, education, etc. But what if government goes deeper into the private sector? Gordon Brown is in the Gulf this week advocating Middle Eastern governments to help in the bailout. Hmmm....

I'm not sure how much salt to put on an NBC subsidiary's broadcast. NBC is owned by G.E. which missed the numbers it promised Wall Street for the first time in heaven knows how many quarters. In a recent Fortune issue, I read that most G.E. businesses are in generally decent shape--they still make excellent turbines, medical devices, etc. But its financial services unit, G.E. Capital got squeezed in the credit crunch. Can you imagine G.E.--the epitome of good management, number one or number two in all its businesses--being unable to roll over its commercial paper? The news coming out of G.E. was so disappointing that I read somewhere that Jack Welch came out saying he'd shoot current CEO Jeff Immelt if the latter doesn't make his numbers.

NBC is also threatened, as with all media companies that are dependent on first-to-be-cut-during-a-recession advertising budgets. Net, G.E. and NBC have reason to drum up optimism. Oh well, conspiracy theory.

My copy of Stereophile just arrived so I'd stop reading the business rags now.

[JackD201]

This reminds me of Alanis. Isn't it ironic?

The countries that have made their fortunes mainly from the U.S.A.'s debt fueled super consumption are now giving their earnings back in the form of bailouts or credit restructuring so they can do it all over again. Go figure.

[AudioAmp]

This reminds me of Alanis. Isn't it ironic?

The countries that have made their fortunes mainly from the U.S.A.'s debt fueled super consumption are now giving their earnings back in the form of bailouts or credit restructuring so they can do it all over again. Go figure.

That is human nature. We build things. We break them down just to build them again

We abandoned tubes and tt. Now we want them back hahaha... But it is scary. I do hope that our country wont be as hard hit. Any inside info sir Jack?

[JackD201]

The last crash made all our banks much more conservative. Something the business sector wasn't thrilled about because of difficulty in acquiring credit for SMEs but it turned out to be what shielded us eventually. Oh the irony once again. On the macro spending of the government, we expect a drop in semi-conductor exports (our number one) due to forecasted lower demand worldwide so expect a cut in revenues there. The U.S. market has turned to devices like the....surprise,surprise....the iPhone as low income consumers are shifting to these little cheap (because they are subsidized by the telcos) broadband devices as their main portals toward internet connectivity. Sadly few if any parts are made here. Korea must be smiling. The biggest hit is expected to come from reduced remittances as unemployment soars in the USA. The profile of OFWs in the US show they maintain on average more than one job. The second or third job is more often than not the source of the said remittances. Every job lost will affect our dollar reserves. Meaning, watch the Dollar climb. My guess is a rise to about 52 to 1 by the middle of the second quarter of 2009.

On China. We're in the same boat as both Audio Amplified and PureSound carry Chinese assembled products. It is a grey area now since what is to come will depend purely on what monetary policy China will adapt. They may choose to finally float their currency to an extent where they become slightly less competitive, meaning higher acquisition costs for us or do nothing. If they do nothing I expect the US to devalue the dollar. Since China currently hold a shipyard full of US treasury notes a devalued dollar would mean less for the US to pay in absolute terms. The flipside is China will lose a substantial amount from the loss of value of the same notes. Then again, what may transpire could be a combination of both as the money markets try to seek equilibrium.

On local political backlashes. Expect more of the same. When I was asked if our own low income families will be affected, I said not substantially because they are poor already. Sad part is sanay na. The 2009 budget that we prepared is a spending budget meant to boost low and middle manpower employment . We need to pump prime. The lower expected revenue will mean however that the original planned deficit figure will be revised into a larger one. Foreign and domestic debt will increase to a level higher than originally planned.

Middle income families will be hit hardest especially those that rely on revolving credit and those that have floating rate loans or leases as inflation sucks up larger percentages of their paychecks. The top 5 percent heavily invested in the stock market have taken a beating in terms of share prices but these are paper losses. Cashflow will matter more than share prices. For as long as bridge financing remains available and the corresponding interest rates stay within bounds companies should be able to weather the storm. By now I'm guessing most expansion plans have been put on hold.

Inflation will cause intense competition for the shrinking levels of disposable income for entertainment. The main protagonists will be telecommunication, transportation, consumer goods, food and beverage and the travel industry. As an example, Jollibee burgers will now compete with text messaging even more intensely for that extra peso. As a result I expect the advertising industry to be least affected despite the projected decreases in aggregate ad spending.

That's all I can guess at for now bro.

[pigdog]

looking at projections in the US with the incoming Obama administration, the US will definitely see a contraction next year, the job market will shrink and the jobless will be around 7% the Dow Jones, Nasdaq and S&P will continue to bounce up and down and chances are it has not bottomed out yet, we will be expecting a low of 7000 with the Dow Jones maybe around the second quarter of the year after reports from the first quarter.. But as things go, us economy may very likely to pick up steam again if the Obama economic plan were to work and it is hoped that perhaps by 2010 the us economy will begin to recover, however it will take at least another year for the us economy to recover. there will be ups and downs next year but i am hoping that with prudent management, the us will find its way out of the quagmire it has sunk itself.

how this bear market affects filipinos. The Philippines rely its primary foriegn remittance on OFW, with a significant number of filipinos working in the health care sector in the us and elsewhere, chances are this will remain untouched, along with workers in the middle east as this area remains booming, the real threat would be from OFWs worker in singapore, HK and elsewhere working as domestic helpers. in the meantime, another industry that has been a stellar performer in the philippines are the call centers likely this may even get better as US companies trying to survive the economic onslaught will continue to rely on cheap labor costs that was being farmed outside of the US, with the filipinos proficiency for english and the relatively low labour costs, the call centers will very likely continue to thrive.

[Quiel]

save or spend?

or shouldn't consumer spending be encouraged instead to contribute to the overall stimulus?

the average joe, like me, might feel his contribution wouldn't make a significant impact. the story of a guy throwing back starfish back to the water comes to mind.

how i wish i have a lot to put this into action and not worry too much of the dire consquence.

[JackD201]

The Japanese have to spend, their prices went up because the business men know the consumers have all that money in the bank. American businessmen are slashing prices because they know consumers buy with credit and are reliant on future income streams.

Here in the Philippines I think priority should be put on budgeting for existing credit obligations. This will keep liquidity in the financial sector stable. The worst thing that can happen to us is for a chain of defaults to happen.

I'm not a fan of credit driven growth. Our company (Kapuso) has one of the lowest debt exposures among the RP top 500. I'm old school in that I was taught to save for things I want. I learned early on that owing money is much more stressful than saving and the instant gratification of having goods bought on credit is easily wiped away every time the monthly billing arrives.

My personal opinion only is to be conservative. Focus spending on the car plans, housing loans, credit card payments and if need be cut back on imported luxuries. That's the best way to help the economy.

On savings keep that nest egg kept for the rainy days safely in strong banks even if the offered interest rates may be lower. If need be distribute accounts to sizes coverable by insurance. On disposable income, start looking for good deals on items you feel will give lasting satisfaction if they are material things and/or on experiences that will have lasting memories. On investment portfolios I would look at dividend plays meaning looking at investments in companies with solid fundamentals instead of buying into companies with good "stories". When this blows over it is these companies that will give the safest returns with the least risk.

[macuser]

I heard a report this morning, is it true that USA has a deficiency of US$445 trillion? It is around 35x of last years GDP.
What will happen to USA? What will be its effect on us in the Philippines?
Is there a cure of all these global economic downfall?

[Wye-FI]

Industry's Becoming Worst.....


Fairchild Semiconductor (FCS) this morning cut its Q4 guidance. The chip company now sees revenue of $338 million to $360 million for the quarter, down 16%-21% sequentially; previous guidance had been for a 6%-12% sequential decline. The company now sees gross margin down 100-200 basis points sequentially; previous guidance had been for flat margin By Harry R. Weber and Samantha Bomkamp, AP Business Writers
DHL to cut 9,500 jobs and close US service centers, Deutsche Post announces

ATLANTA (AP) -- In a move that could greatly scale back a possible venture between UPS and Deutsche Post's DHL, the German company said Monday it will significantly reduce its air and ground operations in the U.S. and cut 9,500 jobs within the countrys at 29.9%. The company now expects R&D and SG&A to be $73 million to $76 million, down from its previous forecast of $80 million to $83 million.

Motorola cuts 3,000 jobs and delays spin-off
By Paul Taylor in New York
Motorola is cutting 3,000 jobs and delaying the spin-off of its loss-making mobile phone business after suffering a $397m loss in the third quarter amid a dramatic fall in handset sales

[highlander]

The Japanese have to spend, their prices went up because the business men know the consumers have all that money in the bank. American businessmen are slashing prices because they know consumers buy with credit and are reliant on future income streams.

Here in the Philippines I think priority should be put on budgeting for existing credit obligations. This will keep liquidity in the financial sector stable. The worst thing that can happen to us is for a chain of defaults to happen.

I'm not a fan of credit driven growth. Our company (Kapuso) has one of the lowest debt exposures among the RP top 500. I'm old school in that I was taught to save for things I want. I learned early on that owing money is much more stressful than saving and the instant gratification of having goods bought on credit is easily wiped away every time the monthly billing arrives.

My personal opinion only is to be conservative. Focus spending on the car plans, housing loans, credit card payments and if need be cut back on imported luxuries. That's the best way to help the economy.

On savings keep that nest egg kept for the rainy days safely in strong banks even if the offered interest rates may be lower. If need be distribute accounts to sizes coverable by insurance. On disposable income, start looking for good deals on items you feel will give lasting satisfaction if they are material things and/or on experiences that will have lasting memories. On investment portfolios I would look at dividend plays meaning looking at investments in companies with solid fundamentals instead of buying into companies with good "stories". When this blows over it is these companies that will give the safest returns with the least risk.

I totally agree to all your suggestions Jack. specially saving for the things I want.....

[hein]

I'm not a fan of credit driven growth. Our company (Kapuso) has one of the lowest debt exposures among the RP top 500. I'm old school in that I was taught to save for things I want. I learned early on that owing money is much more stressful than saving and the instant gratification of having goods bought on credit is easily wiped away every time the monthly billing arrives.

Please tell MARIAN RIVERA she can max out my credit cards anytime.

[Quiel]

eto pa on OFWs: http://ph.news.yahoo.com/star/20081111/ ... 1dfb4.html

last nite's news reported how the market got excited with China's infusion... now i think i know where all the world's cash went all this time

[JackD201]

eto pa on OFWs: http://ph.news.yahoo.com/star/20081111/ ... 1dfb4.html

last nite's news reported how the market got excited with China's infusion... now i think i know where all the world's cash went all this time

Yup China and to a lesser degree India. Goes to show there's truth to the saying that you can have too much of a good thing huh?

[AudioAmp]

Thank Jack for the heads up. There will be rough times ahead but hopefully our banking system will survive. My wife (an investment banker - kawawa sya - wait kawawa kami pala) mentioned that Argentina is 90% on the verge of default. Hence, loans to emerging markets will surely tighten after this happens. Hopefully Argentina + Iceland will be the only casualties this time.

As for Pinas... well... I do know quite a few whos savings are wiped out because their leveraged on their portfolios. Sad to say it will be rough next year. I am bracing for it. I just hope that more Filipinos will be aware of what is happening and understand that in this globalized world we are not an island. If the US sneezes we get a cold. Thank God for China, India and the middle east. Without them the US will be oh so broke At least now we have a more balanced world. My guess is the US will never recover to be the economic super power that it used to be. China, India and perhaps Brazil will share the role of super economies.

[Mr_Jnses]

well, as applied to the audio comunity specially to the middle-income audiophile,cut down on hardware, lps and even cd purchases.save by
maximizing digital music file storage out on your ipod..hehe
seriously tho , i find pricing on newly pressed vinyls or even hi-res digital format luxuriously
priced.

[Mamimili]

I'm old school in that I was taught to save for things I want. I learned early on that owing money is much more stressful than saving and the instant gratification of having goods bought on credit is easily wiped away every time the monthly billing arrives.

Excellent advice Jack, this was a lesson my father made me learn (the hard way) when i was 17 and i wanted everything "now".

Also another reason i use the same hotels when i travel, not many can accept that someone in this world does not have a credit card!
When i went to live in the US, one guy asked me if i had spent my life in jail as he could not believe i did not have a credit history

[pigdog]

I'm old school in that I was taught to save for things I want. I learned early on that owing money is much more stressful than saving and the instant gratification of having goods bought on credit is easily wiped away every time the monthly billing arrives.

Excellent advice Jack, this was a lesson my father made me learn (the hard way) when i was 17 and i wanted everything "now".

Also another reason i use the same hotels when i travel, not many can accept that someone in this world does not have a credit card!
When i went to live in the US, one guy asked me if i had spent my life in jail as he could not believe i did not have a credit history

Paul that would mean you are smarter than the average Joe Moneywise!