Showing posts with label business. Show all posts
Showing posts with label business. Show all posts
Dubai money woes augur a new phase in the economic crisis?
As if to remind the world of the fragile economy, Dubai, the Middle East country with an ambitious agenda to grow financially was spooked by its inability to meet debt obligations.
Dubai’s debt at $80 billion (£48 billion) is enough to worry the market in spite of assurances given to investors by several banks. Dubai World, the state-owned corporation asked a halt on its interest payments, a moratorium of 6 months, because it cannot meet its payments. Affected by the recession, the millionaire’s paradise has suffered a slump in real estate after its extravagant spending on fancy skyscrapers.
“Fears of a dangerous new phase in the economic crisis swept around the globe yesterday as traders responded to the shock announcement that a debt-laden Dubai state corporation was unable to meet its interest bill.
Shares plunged, weak currencies were battered and more than £14 billion was wiped from the value of British banks on fears that they would be left nursing new losses.”---TimesOnline (11/26/09, Hosking, P; Robertson, D.)
The desert kingdom's money problems mirror the economic meltdown still pestering the United States and the rest of the world. Optimistic investors trumpet the tanking of the economy is over, but a double dip recession in 2010 is a real possibility in the interconnected business world.
There is high uncertainty in the market. In spite of instruments available (i.e. Dubai help from the United Arab Emirates,) confidence in the economy is low, leading many to speculate on how many more vulnerable countries will be mired in the crisis. As much as the lesson USA now faces, no country in the planet can rationally buy its way to properity. By borrowing or printing paper money and spending beyond one's capacity people will end up poor in the long haul. (Photo Credit; MailOnline) =0=
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Shoplifting rises globally as recession persists
The Retail Research in United Kingdom in its Global Retail Theft Barometer reports that more people worldwide are resorting to thievery partly due to the money crunch brought about the recession. Thievery accounts for only 1.5% in retail stores in the previous years. However, recently, many people have started stealing in public places raising the incidence of shoplifting to 6% with an estimated business loss of $115 billion.
“…Though the problem was documented across all regions, the steepest increases occurred in North America (8.1%), the Middle East (7.5%) and Europe (4.7%). In terms of total losses, retailers in North America topped the charts at $46 billion, followed by Europe's $44 billion and $17.9 billion in the Asia-Pacific region. In North America and Latin America, store owners and employees were the leading pilferers; in Europe, Asia and the Middle East, it was customers who were swiping the most loot.---- Time.com (11/11/09, Crumley, B.)
Regarded as a “victimless crime,” stealing in retail stores seems benign. Many think it has almost no effect on the consumers at large. But on the contrary. just like hidden expenses of other businesses, losses from shoplifting are charged indirectly to the buying public. Coincident to the fraying of society’s moral values stealing is being rationalized by people. In the ranks of shoplifters are middle-class thieves who don’t only steal to survive, but to do it for fun.
Justifying stealing, shoplifters point to dishonesty in a corrupt society. A redirection of moral outlook is certainly needed. To curve the losses from stealing, security improvement is likewise required. By estimates, shoplifting brings an additional expense burden of $436 and $250 per American and European household respectively per year. (Photo Credit: ReneS) =0=
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New world currency to replace the US dollar?
Yes! This is the proposal being pushed by the United Nations to revamp the world’s monetary system. Officials of the UN Conference on Trade and Development (UNCTAD said the money arrangement right now is not working well and there is a need for change to help correct the worldwide financial downturn.
The proposal comes at a time with China, worried about USA’s increased printing of cash has suggested with Russia that the US dollar, the current global currency must be replaced to avoid inflation.
"Replacing the dollar with an artificial currency would solve some of the problems related to the potential of countries running large deficits and would help stability," said Detlef Kotte, one of the report's authors. "But you will also need a system of managed exchange rates. Countries should keep real exchange rates [adjusted for inflation] stable. Central banks would have to intervene and if not they would have to be told to do so by a multilateral institution such as the International Monetary Fund." ----Telegraph.co.uk (09/0007/09, Conway, Edmund)
As predicted by economists, hyperinflation is a risk for the United States as the Obama Administration tries to implement its plan of excessive spending. Worrying the public of the present money crunch, the US budget deficit has worsened and risig fast. With Obama's watch, the US economy is expected to saddle a staggering 9 trillion deficit in the next 10 years putting a huge burden to taxpayers.
In the recent poll of the a Geneva-based World Economic Forum, the US dropped down only second to Switzerland as the most competitive economy in a poll conducted to greater than 10,000 business leaders. Singapore and Sweden came third and fourth respectively. (Photo Credit: =0=
Yes! This is the proposal being pushed by the United Nations to revamp the world’s monetary system. Officials of the UN Conference on Trade and Development (UNCTAD said the money arrangement right now is not working well and there is a need for change to help correct the worldwide financial downturn.
The proposal comes at a time with China, worried about USA’s increased printing of cash to buy bonds has suggested with Russia that the US dollar, the current global currency must be replaced to avoid inflation.
"Replacing the dollar with an artificial currency would solve some of the problems related to the potential of countries running large deficits and would help stability," said Detlef Kotte, one of the report's authors. "But you will also need a system of managed exchange rates. Countries should keep real exchange rates [adjusted for inflation] stable. Central banks would have to intervene and if not they would have to be told to do so by a multilateral institution such as the International Monetary Fund." ----Telegraph.co.uk (09/0007/09, Conway, Edmund)
As predicted by economists, hyperinflation is a risk for the United States as the Obama Administration tries to implement its plan of excessive spending. Worrying the public of the present monetary plans, the US budget deficit has further jumped and is expected to reach 9 trillion in the next 10 years.
In the recent poll of the Geneva-based World Economic Forum, the US dropped down second to Switzerland as the most competitive economy in a poll conducted to greater than 10,000 business leaders. Singapore and Sweden came third and fourth respectively. (Photo Credit: AP; Mary Altffer) =0=
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US homes and businesses, another scandal for the Arroyos?
In the fading days of Pres. Gloria Arroyo’s term as president, another allegation of ill-gotten wealth is brewing for her family. Her son, Pampanga Rep. Juan Miguel "Mikey" Arroyo, was reported to have failed declaring a P63.7 million property fronting San Francisco Bay in California. It was alleged this foreign property located at 1655 Beach Park Blvd, Foster City was named under his wife’s name in 2006.
“By omitting the US property starting in 2007, Mikey’s real property assets plunged from P90.7 million in 2006 to P27 million in 2007 and 2008.
All the business interests Mikey declared in his latest SALN were acquired when he was already congressman: president of Mikey’s Horseman Bar and Grill, 2006; director of LPG Auto Gas and shareholder in Los Manos Verdes Inc., 2007; and shareholder in U18 Properties Inc. and stockholder of the La Vista Investments and Holdings Inc. in 2008.”---Malaya (08/31/09, Files, V.)
Similarly, Dato, Gloria’s other son also bought a house worth P26.7 million in the golden state after he won as congressman in 2007. But this, he declared in his tax declarations.
These allegations are on top of local businesses that the Arroyos are reportedly engaged in. As usual, the first family has to answer with a denial. But won't they give their proof? The Filipino people need to know if there is any wrong-doing in these property purchases. With another investigation it will take time to know if all these accusations are true. (Photo Credit: ____) =0=
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A slow recovery from recession is still a threat according to Dr. Doom
Nouriel Roubini, the economics guru of NYU who accurately predicted the morbid economic meltdown still warns of a double dip recession in spite of the rosy forecast made this week by the chairman of the board of governors of the US Federal Reserve Ben Bernanke--- that there are indicators that the recession is wearing away.
Called Dr. Doom for his precise economic forecasts, Roubini shared his thought-provoking opinion in an article he wrote in Ft. com (Financial Times) on Sunday August 23, 2009 entitled “The risk of a double dip recession is rising.”
Unlike many optimists who want to have a rapid V-shaped recovery, Roubini thinks a U-shaped slow healing from the economic downturn is more likely to occur, probably within a two-year period.
Among the Roubini's reasons for a sluggish recovery are the rising unemployment in US and other parts of the world topping 10% till next year. A crisis in solvency prevents banks to lend and the private sector to invest. Consumers are cutting on expenses. The financial system has still to recover from the damage and losses incurred during the meltdown. Energy and food prices are still rising. There is less profits with high risk of debts and defaults as companies avoid expanding their investments and hiring more workers. (Photo Credit: canoraa) =0=
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Chicago interrupts business day to save
To cut cost, the City of Chicago temporarily stopped government businesses by calling on a non-paid holiday for its workers on Monday, August 17, 2009. Among its services the city stopped garbage collection, closed libraries and interrupted street cleaning by asking workers to stay at home. However, emergency services in hospitals, police department and firefighting units were available.
Because of the skyrocketing budget deficit that runs to more than $500 million, Chicago reduces its services to save money just like what other cities have done. Saving of $8.3 million is expected by the partial business stoppage. There is pressure to increase taxes to close the city’s budget gap. (PHoto Credit: destination hero.com) =0=
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Local drug companies share only 1/3 of the RP’s pharmaceutical business
Of the P115 drug industry in the Philippines, the majority, about 2/3, is controlled by foreign companies. Only a third of the drug market is cornered by Filipino drug manufacturers.
Of the Filipino drug companies, United Laboratories (Unilab) gets the highest share (22%) being the leading producer of generic medicines in the country. Smaller companies only capture 10% of the market.
Willy Fabroa, director of the Philippine Chamber of Pharmaceutical Industries Inc. had this to say:
“In the case of Mercury Drug, the country’s largest drugstore chain distributes 3,000 essential drugs made by foreign drug firms and only 500 generic brands from local drug firms. “Kaya wala talagang kalaban-laban ang generics sa drugs mula sa innovators.” ----Manila Standard Today (08/06/09, Ramos Araneta, M.)
Therefore, there is room for expansion of local drug manufacturers, particularly in the production of generic medicines. However, it needs capital to compete with the multinational drug companies. The development of a local drug industry has been a long-time need of Filipinos who are saddled by high cost of medicines. (Photo Credit: Lynnticular) =0=
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Life Entrepreneurship Program
CREATE ABUNDANCE BUSINESS COMMUNITY
by Berna Moldez
"A community dedicated to creating a world that works for all"
Life Entrepreneurship is Being a contribution, Doing business while living life's purpose and Having personal development and significance.
Our Vision: Create One Thousand Multi-Millionaires by the year 2020.
Our Mission: Spread Financial Education throughout the Nation.
Because of this vision and mission we developed the Life Entrepreneurship Program designed to create Wealth from Zero.
This program is open only to people who are success-driven, open-minded, coachable, willing to build and expand their business empire.
If you share the same vision of a First World Philippines by year 2020, I invite you to one of our public events entitled:
Wealth Course: "Discovering and Reprogramming your Personal Wealth Operating System and Money Blueprints"
FREE REGISTRATION
This course consists of three Modules. One module per session.
Module 1. Awareness - Uncovering Money Operating Systems ™
Module 2. Understanding - Source of Limiting Wealth Beliefs and Empowering Wealth Beliefs
Module 3. Reconditioning - Reprogramming Money Operating Systems ™
When: Mondays and Tuesdays (Ortigas), Wednesdays and Thursdays (Makati)
Time: 3:00-6:00 pm and 6:00-9:00 pm
Where: Ortigas - Starbucks Coffee Pearl Plaza, Pearl Drive, Ortigas Center Pasig
(near the area of SM Megamall Bldg B, University of Asia and Pacific & Richmonde Hotel, Pearl Drive is parallel to San Miguel Ave.) Makati – Kaya Restaurant, 2nd Floor Paseo Center, Paseo De Roxas, Makati City
For seat reservations, you can text me at 0916.5316580 or 0923.6363614. You may also send an email to: bernamoldez@createabundance2 020.com for inquiries and reservations.
Everyone wants to be wealthy, what sets you apart from others is when you TAKE ACTION! (Photo Credit: Sheltercrow) =0=
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Billy Mays' autopsy revealed heart disease as probable cause of death
The sudden death of Billy Mays, TV’s popular endorser of household products was a surprise and many of his fans want to know why. Feeling unwell before he slept, he was found dead in his Tampa, FL condominium last Sunday, June 28, 2009.
In an autopsy conducted, Hillsborough County Medical Examiner Vernard Adams said Mays could have died of a heart attack during his sleep. He suffered from hypertension and the left ventricle of his heart was enlarged.
Though more lab tests will be done to confirm the cause of death, there was no evidence of injury after he bumped his head during a rough plane landing in a trip from Philadelphia to Tampa prior to his demise.
The successful bearded 50-year old amiable pitchman of home products who popularized and sold household aids such as detergents, cleaners, and gadgets in TV suffered from hip problems. He planned to have surgery, but was found unresponsive, cold and cyanotic in bed. His wife called 911. Apparently he was dead.
Billy left his wife Deborah, a 3 year old son and a stepson past his teens. The initial post-mortem findings somehow provided some closure to the passing of Mays who will sorely be missed.
Of course there are other news worth paying attention to----the impending withdrawal of US troops in Iraqi cities that pose danger to the peace and order of the country, the coup d' etat of Honduras that ousted its president, the crash of a Yemeni jetliner with 150 on board in the Indian Ocean, and the continuing civil protest after the rigged Iranian election, among others. (Photo Credit: Ronin) =0=
UPDATE: August 7, 2009---Additional report of the medical examiner revealed that cocaine use contrbuted to the death of Billy Mays.
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Foursome kinky sex: Calvin Klein’s raunchy ad stirs protests
In New York’s Soho district where thousands pass by everyday, Calvin Klein compnay has put up a 50-foot billboard advertising. Two young men, a woman and another man are in explicit pose with strong sexual undertones illumined high above the street.
Semi-nude man and woman are shown kissing. Another man is embracing. With navel exposed and a flat abdomen heaving, a confused guy undresses to the verge of the mon pubis----something that corporate business brings to sell blue jeans fast.
But many people aren’t happy. Parents are bothered by the racy poster which shows the disturbing unnatural sexual message to children. Even if others justify the risqué billboard claiming that “obscenity is on the eyes of the beholder,” Randy Sharp, the director of special projects for the American Family Association, vehemently protests with many others:
"Not only the billboard, but a company -- a corporate giant in America -- feels it appropriate to put a semi-nude photograph in a major billboard in a high-traffic area where tens of thousands of children see this kind of activity going on... If it were going on in the back of a parking lot with steamed windows, they would be arrested, and yet they broadcast it to a whole city."----ABC News (06/17/09, Donaldson James, S)
With liberalism all around, this is the kind of lewd advertising people get. There are reasons to be concerned and concerned citizens are justified to voice their displeasure.
That’s why members of the organization who find the ad disgusting have flooded the Calvin Klein Co. with thousands of email complaints against the sexualized billboard. It’s something the jean company wants---- Perhaps, to foment cultural and moral discord in pursuit of that attention which brings sales in the cash register. Photo Credit: stylelist/ Maggie Coughlan/ AOL) =0=
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RP lagging behind Asia’s competitive nations
As the country focuses on the risque sex video scandal of plastic surgeon Hayden Kho and starlet Katrina Halili, we get distracted from significant national issues like the latest corruption charges against high ranking military men ---allegedly pocketing millions of pesos intended for soldiers in the 2007 US-RP Balikatan exercises. The "Euro Generals Scandal" which involved the embarrassing money laundering of high ranking Filipino military officers discovered by Russian authorities in Moscow has been forgotten.
Now, consistent with these scandals, a report which impacts on every Filipino tells of the floundering global competitiveness of the country. It’s the kind of bad news that we rather not talk about. This year RP placed a dismal 43rd out of 57 in the World Competitive Yearbook released by the Swiss Business School.
“Among 12 Asian countries on the list, the Philippines got the poorest ranking with Hong Kong considered as the world’s second most competitive country, next to the United States. Singapore ranked 3rd; Japan, 17th; Malaysia, 18th; China, 20th; Taiwan, 23rd; Thailand, 26th; Korea, 27th; India, 30th; Kazakhstan, 36th, and Indonesia, 42nd.
The Philippines’ competitiveness grade regressed the past five years having been ranked 40th in 2005, 42nd in 2006, 45th in 2007 before improving to 40th last year.
The economic performance of the country deteriorated progressively since 2005 when it was ranked 36th, 45th in 2006 and 2007, and 42nd last year.
On government efficiency the Philippines was ranked 42nd, on business efficiency, 32nd and infrastructure second to the last at 56th. ”---Daily Tribune (05/21/09, del Callar, MP)
The reason given for the fall in RP's ranking is graft and corruption. So we tell ourselves what’s new? The data above are very disconcering. We have enough black-eyes to deal with.
As long as we don’t do something about corruption, with our economic stagnation, morale and moral decline will continue. Even the United Nations (UN) has warned us that lack of government oversight on foreign aid and the national budget, paves way to graft which weakens the government. (Photo Credit: Stormcrypt)=0=
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Warren Buffet decries the dismal future of US newspapers
In last week’s shareholder's meeting of Berskshire Hathaway Inc.,attended by 35,000 people, Warren Buffet, the “Oracle of Omaha” decried the waning of readership of newspapers in America. The rich billionaire-investor together with his business partner 85-year old Charlie Munger spoke of the dismal future of newspapers which had been predicted even before the Newspaper Association of America disclosed the decline newspaper business.
In 2007, total print advertising revenue dropped 9.4% ($42 billion,) a huge fall in revenue since 1950. Newspaper revenue losses continued during the past 16 months of recession as readership contracted 4.6 percent in the April-September 2008. The drop in sales prompted newspapers to reorganize, cut down on jobs and lessen circulation.
Fewer readers are buying newspapers these days. They now depend on alternative sources of news which are available in online, internet, radio, and TV. Many are disappointed by the increasingly partisan stance of US newspapers, raising doubts on the truthfulness and reliability of their contents.
“Some readers instead are shifting to the free versions of newspapers that most publishers post on their Web sites. That trend helped increase the traffic on newspaper Web sites by 10.5 percent during the first three months of the year, according to a Nielsen Online analysis conducted for the Newspaper Association of America.”---- Yahoo News Finance / AP (04/27/09, Liedtke, M)
About 15 to 30% of major newspapers's revenue comes from subscriptions and copies sold at newsstands. The main source of income still comes from advertising, a money source that is now in danger of drying up. (Photo Credit: Maud77; photoburst)
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Fearless economic forecasts
Dominique Strauss-KhanIn a warning delivered by IMF Managing Dir. Dominique Strauss-Khan during a conference of African finance ministers and central bank governors, the International Monetary fund (IMF) speaks of the deepening global financial crisis and the possibility that the world's economic growth will be zero.
The financial meltdown can cause massive suffering, social displacement, and chaos in vulnerable countries.
The effects of the downturn may not be fast in reaching Africa, but Srausse-Khan said, “continued deleveraging by the world's financial institutions, combined with a collapse in consumer and business confidence, is depressing domestic demand across the world."----Philstar (03/10/09)
Warren Buffet
On the other hand, American billionaire Warren Buffet who has the common sense of living "below his means" believes America will bounce back even though “it has fallen off a cliff.” The “Oracle of Omaha” who predicted the worst case scenario in the last 6 months, watches a nation swept with a housing slump, high unemployment, and inflation. He sees lack of confidence, confusion, and fear are defining consumer behavior at this time.—The Washington Times/ AP (03/09/09, Funk J)
Harry S. Dent
Similar gloomy predictions have been made by American economist Harry S. Dent in his book “The Great Depression Ahead : How to Prosper in the Crash Following the Greatest Boom in History.” The book is a good read. He speaks of this year as a bad season---ushering economic turmoil that none of the current generation has seen.
Nouriel Roubini
Nouriel Roubini, professor of NYU’s Stern School of Busicness believes the US recession could last up to 36 months. With no hope of ending the recession this year, "Dr. Doom" said,, "Growth is going to be close to zero and unemployment rate well above 10 percent into next year."----CNBC (03/09/09, Wells, J)
Pres. Barack Obama
But President Barack Obama offers bright economic forecasts with his proposed $3.55 trillion budget. He predicts that the economy will shrink by only 1.2%, and will recover in 2010 with a growth of 3.2%. However, non-partisan analysts believe this is overly-optimistic.---McClatchy Newspapers (02/26/09, Hall, K)
The public is less upbeat than Obama, but people are willing to give him the benefit of the doubt. Midway in the 100-day honeymoon period after assuming presidency, he gets a 67% approval rating, a very good grade at this time when Americans are fearful and disconsolate over the financial ruin they are dealing.(Photo Credit: Atsibatsi)=0=
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Buhi-Malinao road ushers in more commerce for Bicol
Linking communication is the most obvious benefit of having a road between towns and villages. Alternative routes of trade and commerce are made easy. These are expected in the recent completion of the 35 kilometer road (about half of 66 kilometer highway) which connects the 2nd and 4th districts of Camarines Sur to that of 1st district of Albay.
Leading to the port area of Tabaco, Albay, the highway makes it easier to reach Catanduanes Island in Bicol. Travel from Manila will be shorter than before.
The new road starts from Hanawan Ocampo, Camarines Sur onwards to Barangay Burokbusoc and Sagrada in Buhi, Camarines Sur, reaching up to Malinao, Albay. It is heralded as an accomplishment by LV Castaneda of the Department of Public Highways, (DPH.)
But Buhinon Jesus Valenciano (in a letter to Bicol Mail's editor,) writes to question the integrity of the road. He fears that the "all-weather road" in some sections need cementing or asphalting. He says, without good maintenance, this road can easily fall into disrepair. ----Bicol Mail (02/19/09; 02/26/09) (Photo Credit: www.freewebs.com/infocenterbuhi/) =0=
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Obama addresses congress for the first time
Pres. Barack Obama at present enjoys high level of public support optimism and confidence. Americans badly needs him at this time even if political trust doesn’t necessarily translate to economic confidence. The stock market for the last month continues to flounder in spite of the change Obama has been pursuing. Those badly hurt by the economic downturn watch silently where the recovery program will go. Rightly so, it is early to give in to pessimism, but there is a cause for concern.
Those with money are afraid to invest---the stock market behaves erratically as if to suggest that something isn’t right. It is expected to go for undetermined amount of time in spite of the bold assurances of Obama. People badly affected by the financial crisis are confused, some can’t get over their shock on what's going on.
Opinion on B. Obama:
--------------------------------Approve-----------Disapprove--------No Opinion
His job as president------------63%-----------------22-------------------15
Foreign Policy-------------------57%-----------------17-------------------26
The Economy-------------------57%-----------------32--------------------11
Iraq Situation--------------------54%-----------------24--------------------22
Source: New York Times (02/23/09, Zeleny, J; Thee-Brenan, M)
On Tuesday, February 23, at 9PM eastern time, Obama will address the joint congress. He enjoys strong political clout with about 2/3 of the American people supporting him. A rising number however is skeptical. In spite of the benefit of the doubt, many are struggling to fend off their ambivalence. There are those who feel they’re practically on their own, without much reason to believe the government will look after them since their finances have been ruined by mismanagement. They can't take the thought of bailing out irresponsible Americans in cahoots with unscrupulous bank lenders who bought homes beyond their means.
Obama's Disapproval Rating Doubles
According to a recent Gallup poll, Obama's new disapproval rating rose from 12% last month to 24% this month. This is 50% higher than the 16% average for a month-old new presidency. ----Los Angeles Times ( 02/24/09, Malcolm, A)
Americans really can’t be too trusting these days, not even with Obama’s popularity. Words cannot change reality. Sixty (60%) of the public worries that someone in the family will lost a job in the coming months or the next year. Fifty-five (55%) of the Americans says they are just trying to make ends meet. While Americans are under no illusion to believe that the economic problem will die down soon, it’s unclear if they who are extravagant and used to good life can weather the turbulence of the recession.
In spite of the media’s overwhelming biased adulation for Obama (as described in Bernard Goldberg’s book “A Slobbering Love Affair: The True (And Pathetic) Story of the Torrid Romance Between Barack Obama and the Mainstream Media “)it is still the truth that matters. People can’t live with the promises and eloquent words of a president, they need to see tangible results, especially those who put their reliance on the government to solve their problems. (Photo Credit: Alex Johnson)=0=
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In spite of a collapsing financial world, $18.4 billion were spent for greedy bonuses in Wall Street
If there is consolation to American taxpayers damaged by the economic meltdown, Pres. Barack Obama criticized billions of astounding spending. He decried as "shameful" and "irresponsible" the $18.4 billion bonuses distributed during the past year for workers in Wall Street. Yes! In spite of a 44% cut on yearend perks given to the money merchants, the amount clearly shows the extravagance and greed of the people who are partly to blame for the financial crisis. A staggering $18.4 billion was spent as giveaways in spite of the $700 billion bail-out they asked and handed over by the government because of a crumbling economy.
This news doesn’t help the effort to bring back trust in the system. The disclosure speaks of top officials still engaged in reckless spending, some using large amounts of money in the shadows to continue their vice.
Amidst joblessness, home sales slump, and poor stock performance, Obama is facing the challenge of making the public believe. Congress has just approved the $825 billion “stimulus package” which is basically another big spending to mitigate the damaging effects of the financial mess. More enraged Americans fear that unless transparency and ethical practice in business is restored, there is little reason to hope that confidence will come back and the economy will be fixed in due time. (Photo Credits: Epicharmus x 2)=0=
Getting to know Charles Ponzi
Charles Ponzi (1882-1949) was a US immigrant from Lugo, Italy who swindled thousands of New Englanders in a postage-stamp scam in the 1920s. He popularized an investment which paid returns to investors out of the money paid by those who followed them rather than from profit. This illegal money operation was named after him. The Ponzi scheme as it is known today, evolved with many variations. Disregarding some differences in the swindling method, Ponzi had been sometimes referred to as the "pyramid scam."Promising 40% investment return against that which was offered by savings banks with only 5% yield, Ponzi convinced thousands of investors that he could make astounding profits on a buy and sell of international mail coupons. His scheme worked for sometime on the principle of “rob Peter to pay Paul.” Basically, it was a set-up of cash pay-off and distribution without real investment---http://www.sec.gov/answers/ponzi.htm
Ponzi’s fast money and high rate of return was too good to resist and many were snared into the fake investment operation. He became an instant millionaire who diverted the money of new investor-recruits to pay for those who invested earlier until the operation collapsed.
At the end of his financial fraud, only a third of the duped investors’ money was returned. Investors’ losses amounted to about $3 million to $7 million (about $75 million today)in those days. Ponzi was convicted for mail fraud and embezzlement, put to jail, and later deported. (Photo Credit: Wikipedia) =0=
Bernard Madoff, accused top Ponzi scheme artist is allowed bail
Ponzi scheme artist Bernard Madoff who was accused of swindling the business world of a staggering $50 billion had been granted bail against the assertion of prosecutors that he is a flight risk and an economic threat to the community. During the holidays while waiting for indictment, the former Nasdaq chairman sent friends and relatives diamond bracelets, jewelries, and gifts amounting to about $1 million in violation of a court-ordered freeze.
But Federal Magistrate Judge Ronald Ellis of Manhattan ruled that Madoff (who did not have prior convictions,) could stay in his luxurious $7 million Eastside Manhattan apartment with some additional restrictions--- instead of being locked in jail.
“The anxiously awaited bail decision does put additional restrictions on Madoff, including forcing him to come up with a list of items at his apartment and allowing a security firm to check on the items. The security company will also be allowed to search all outgoing mail from Madoff to ensure that no property has been transferred”.---AP (01/12/09, Neumeister, L)
The judge’s decision disappointed and infuriated many who were victimized by the fraud, supposedly the largest ever in financial history. They believed the accused swindler who was reportedly fitted with an electronic surveillance tag on his ankle got a “different brand of justice than the guy in the street.”
Madoff’s decades-long fraudulent business activity operated similar to a pyramid scam under the guise of a legitimate trading powerhouse which promised high investment yields with low fees. His company which started in 1960 attracted high profile banks, industry leaders, well-connected individuals, loyal friends, and rich celebrities. R. Thierry Magon de la Villehuchet, a prominent hedge fund manager-client who lost $1.4 billion committed suicide in his office in Madison Avenue last month.
In spite of the gravity of the accusations and the public clamor that Madoff be confined in prison, the judge’s decision to put him on house arrest shows how the legal system operates. Following the course of a criminal proceeding, it will take some time before a conviction, if apt for this case, will be decided.
Of course this isn’t consolation. The erosion of trust is astounding. At the back of this monumental fraud, the government regulators appear negligent for the red flags of fraud has been there for years. They have not done a good job in protecting American citizens---especially those ordinary investors on the street. (Photo Credit: Adam Crowe) =0=
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Obama psyches the Americans of grim economic times
I don’t know of anyone who hasn’t been affected by the financial crisis caused by the meltdown of business in America. The most pitiful are the people who honestly saved and invested only to find out their portfolio has failed. They don’t have the luxury of youth and time to recoup the loss. Those who rely on fixed income may find themselves without money if retirement and pension don't pay. The jobless and hungry are easily agitated. Economic hardship is a perfect recipe for social unrest. With the public's high expectations on the new administration, it's dangerous if Barack Obama fails.
Barely two weeks before Obama is to be inaugurated as president, his campaign promises don’t jibe well with the gloomy realities of the times. His dire warnings prepare the spooked public of the bumpy road ahead. Spending is needed more than what the government originally told the people.
Obama can only say in grim and gray terms on how he'll solve the economic problem, but he doesn't give specifics. The cost of the stimulus package he asks the congress on Thursday, January 8, 2009 hasn't been determined, but experts say it should not be more than $1 trillion dollars. The federal budget deficit is huge and critics warn of deeper pain if the government shoulder the money woes of private entrepreneurs.
There's no guarantee that the bail-out of the banking system, the auto manufacturers, and housing industry will work. The economy is rife with dreary predictions of worsening unemployment, bankruptcies,and unrelenting housing slump. Americans are confused and want transparency in the transactions which put their life savings and taxes in line.
At a Glance, January 8, 2009:
540,000 unemployed projected for Jan. '09 (up from 492,000 in Dec. '08)
4.5 million workers on unemployment aid
2.4 million jobs lost in 2008
1.2 trillion dollars Federal Budget deficit
1 trillion dollars---estimated stimulus package needed
As of January 8, 2009, the joblessness is expected to have risen from 492,000 to 540,000 based on the number of newly-laid off people seeking state unemployment aid. The approximate number of workers taking unemployment benefits is at 4.5 million, many of whom are finding hard to get jobs.
Assuming that 500,000 additional jobs have been lost last month, it is estimated that at least 2.4 million jobs disappeared in 2008. Business downsizing and closures continue. The trend will be more elucidated on Friday, January 9, 2009 when the Department of Labor releases the most current employment report. The federal budget deficit is expected to reach $1.2 trillion this year, about 3X bigger than the previous year.
Like most Americans, I want Obama to succeed. Casting away politics, I feel it's in our interest that the economy bounces back on its track. Yet, the public is suspicious and worried; their confidence is at its deepest low. In spite of bipartisan support, many aren’t optimistic that a quick recovery will come. Obama is asking for more government infusion of money, a stage for a possible run-away spending that isn’t in his "change" and "yes, we can" campaign plan.
The uncertainty which fuels this lack of confidence is magnified by the ugly economic picture. Even if the public keeps quiet, the cultural and social environment which made the people endure and outlast the Great Depression in the 1930's might be slipping away--- at worst, it might be nonexistent. Today's Americans belong to a different generation of innovators. Whether the values of trust, honesty, and fair play have been eroded to impair recovery, nobody seems confident to answer.
There's real fear as there's hope. But many are shocked that the rules of governance and citizenship are quickly being changed to suit a social agenda whose end they don't know. They aren’t used to live in poverty or be dictated upon on how they will use their money. Even if they pride themselves of resiliency, industry, and independence, the overall picture isn't good. (Photo Credit: bscott2007)=0=
RELATED BLOG: "Dr. Doom’s economic crystal ball & the need to say the truth"
Posted by mesiamd at 10/30/2008
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GMA’s ditch-low approval rating, her kiddie “payback package" for OFW's & a big store in Naga City rises
Negative (-30)President Gloria M. Arroyo gets the lowest satisfaction rating in 2008, much lower than the (-)9 she got the year before. The Social Weather Survey (SWS) result from the 4th quarter poll at the end of November is thought to be bad. It attests to the unpopularity of the administration that’s wracked by corruption and nepotism, believed to be worse than that of Ferdinand Marcos.
Unresolved issues like joblessness, floundering economics, the Bolante fertilizer scam, Euro generals money laundering case, unabated maritime disasters, journalist killings, charter-change controversy, poor education and healthcare, Mindanao secessionist problem, CARP extension, unimplemented cheap medicine law, and the big C (Corruption) noticed by watchers abroad are in the long list of problems that stun the public.
P1.4 trillion
It’s the 2009 national budget which is approved in the second and last deliberation in the senate. Notable in the budget are less allocations for the Department of Agrarian Reform by P3.1 billion, Energy P61 million, Finance 13 million, Local Governments P436 million, Justice P215 million, Armed Forces P75 million, Public Works P3.4 billion, Social Welfare P243 million, and National Economic Development Authority by P25 million. The budget cuts on certain services are allocated in other areas. A P10 billion economic fund is being considered, but no appropriations are set aside for the Office of the Press Secretary, the Philippine Tourism Authority and Kilos Asenso.
4,000SM, the large monopolistic mall-chain owned by business mogul Henry Sy, Sr. in the Phiippines, is making preparations to open its outlet in Naga City on March 2009. About 4,000 job-seekers are needed in the operation which is estimated to generate $12 million in wages and P40 million in taxes. Expected to compete with small stores of the area, SM may draw shoppers in neighboring towns.
The exact effects of such a huge business in the city of 160,000 people aren’t completely known. Will there be congestion in the city? Will money windfall benefit the Bicolanos? Will profits be carted away from the area and render the mom-and-pop stores struggling to survive? Did the Naga City officials do a thorough study on the cost-benefit of approving an SM store?
50,000As a result of the global economic crisis, the number of Filipinos abroad expected to be laid off has increased. Pres. Gloria M. Arroyo has laid out a “payback package” assistance for retrenched overseas foreign workers (OFW’s,) a tepid offering of skills training, scholarships, and measly P10,000 ($200) to start a “business” upon their return to the country.
15,000
Participants of the Manila’s anti-charter change (cha-cha) rally were larger than expected, according to Makati mayor Jejomar Binay, the president of the United Opposition. More protests against Cha-cha and other frustrating issues are on the works with broadened support from various organizations. (Photo Credits: gmaresign; doublefault2; arty; gmaresign=0=
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