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Beating scams
When the nation was an Easy Street
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Alvin Ang
Tito Genova Valiente
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he World Bank published in 2015 the report “Enhancing Financial Capability and Inclusion in the Philippines—a Demand-side assessment.” It was based on a survey conducted in 2014 covering 3,000 respondents in an attempt to profile, understand and compare the financial capabilities of Filipinos. The World Bank defined financial capability as the capacity of individuals to act in their best financial interests given the socioeconomic and environmental conditions. Capacity here includes knowledge/literacy, skills, attitudes and behavior with respect to understanding, selecting and using financial services.
omething tells me the hot, searing days are over. Outside the gate to my old apartment, a heady, heavy wind prevails over the stench of this big city. It is not a wind that comments on how diminished or majestic life can be; it is more kindred to the breeze that assures comfortable blanket nights ahead. It is the wind of memory.
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There are three aspects included in the report, but we will focus only on the financial capability aspect. Using a seven-question basic financial literacy test, the report showed that the average score of Filipinos is about 3.2 out of seven questions. This means that the respondents could only answer less than half of the questions correctly. Worst, about 20 percent of the respondents did not answer correctly. The most difficult concept for Filipinos is compound interest, where only 29 percent of the respondents was able to answer correctly. When cross-tabulated for socioeconomic status, those having low financial literacy scores are those who did not save as a child, nonhousehold heads and men. As regards retirement, less than 25 percent of the surveyed aged 60 and below are prepared for their old age. The study also showed that those who are not prepared for old age are “not worried” about their future. These results actually validated a continuing research that my colleague Jeremaiah Opiniano (PhD student at University of Adelaide) and I have been working regarding financial behaviors of Filipino migrant workers, their families and their communities. From 2011 to the present, we have studied about nine municipalities across the country and conducted surveys and focused group discussions to find out how remittances can be channeled for development purposes at local government levels. Similar to the World Bank study, we found that less than half of respondents are able to answer correctly questions about loans and prices, and those with migration experience have more correct responses than those who do not have any migrants in the family. When asked where they get their information about handling money, the majority said that they get it from their own ideas. They also rated their money handling skills as good and when asked if they need help in handling money, they responded in the negative. We then asked them if they record their income and expenses—the majority answered that they do not record their income and expenses but they have a general idea of how money enters and goes out of their family. Both studies, and I am certain there are a lot more out there, will conclude that our society is in dire need of a good financial education. In the World Bank study, they found that financial capacity improves with the level of education. Toward this the government has initiated a number of policy reforms and advocacies to increase financial awareness among the population and especially the young. Republic Act 10922 4 Components of a True Investment
Any investment must have four components. It must have risk, return, liquidity, and tax (a true investment has to be registered with the government and should be subject to some kind of an income tax). A quick analysis should tell us that if any one of the four components is missing —consider that as a scam. mandated the celebration every second week of November of the Economic and Financial Literacy Week to develop the national consciousness. Likewise, one of the offshoot of the World Bank study is that the Bangko Sentral ng Pilipinas, BDO Foundation and the Department of Education have partnered to develop financial literacy materials for use in basic education. Since we are combatting a challenge that begins from childhood, it will not be enough to go and fight it at the school level. We must respond to this challenge across the lifecycle. In an Economist magazine article written in the 1990s, it is said that people make decisions based on recent data. We have short memories that even if we know something looks like a scam, we tend to think that it is not. Also, for matters concerning investments, we think in inductive manner (using specific cases then relating to general situation) because understanding the bigger picture is expensive both in terms of time and money. This is why we easily believe when someone (who is credible to us) said her/his investments got a 100 percent return in a month’s time. In many scams, people do not bother checking the company, products or services that are being offered. They rely on the word of mouth/credibility of someone they know who already gained out of it. I have developed the following table to analyze any investment offer. Any investment must have four components. It must have risk (the probability of losing the investment), return (the possible earnings out of the investment), liquidity (how soon can the investment be pooled out) and tax (a true investment has to be registered with the government and should be subject to some kind of an income tax). A quick analysis should tell us that if any one of the four components is missing—consider that as a scam. This takes away any personal and emotional opinion, just a good old checklist. A good financial advisor should be able to explain these four components in any solicitation that she/he is offering. In the end, the best way to analyze a scam is when one is too good to be true, then it is not true.
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I have been reading a lovely book about Paz Marquez Benitez. It is a collection of her letters and writing with introduction and annotation by her own daughter, the equally significant Virginia Benitez Licuanan. With the book, the clan of the Benitezes and the Licuanans are blessed with the fate of good remembrances. But, if this book can only be useful and important to those related in social class and lineage to Paz Marquez Benitez, then the book is limited in its appeal. But that is not so: The book is filled with guides to a past—a gilded past when politicians had all the chance to becoming statesmen and many did so. Published in 1995, the book came out when this nation was on a rebound from the tragedies and opera buffa brought about by the dictatorship and the long martial law years. I am reading it—actually rereading —presently when the country is losing any inspiration, when the huge number of people are at a loss with the impunities committed by the present administration, with the vulgarity and mercenary actions of even those we thought had enough classical education in them to remind them about the goodness of humanity and, therefore, the command to be good themselves, when the nation and its entire geography is being dissipated not through the mercy of Nature but via the lack of wisdom and political will of the many whose ignorance and vacuity in spirit are organic to their corrupt individual statuses. The book on Paz Marquez Benitez, the erudite and the romantic behind
Dead Stars, the first short story in English written by a Filipino, is also history. It is a historical account not saddled by the burden of deconstruction. The book does not pretend to talk about the masses; it tells the story of a small number of families who, by their socioeconomic status and intelligence as well, ran the fledgling republic or, to be precise, Commonwealth. Thank god, I am not a historian. Good history is not always linear. One can discover a material document at a certain point and whatever that material contains will be the beginning of the consciousness of that individual. Only writers who believe in the dullness of linear storytelling are saddled with the angst of imposing the consecutive and the sequential. History is discovered day by day; artefacts are studied and analyzed not in series but upon discoveries, and, later, serendipities. Rereading now the book on Benitez is going into her metaphor of the dead stars. The information and knowledge that had been handed down to us may not be alive anymore when it arrives at our age. But the wisdom shines as bright and as true as ever. Here is the value of the book: Benitez as recalled by Virginia B. Licuanan through the letters she left behind talks to us about the incipient years, those days when a few intellectuals and leaders were at that intersection between doing good for the country or bungling what destiny had given them in terms of opportunities.
The Philippines through the poignancy of the letters seemed small and manageable. Here are our heroes and heels. Paz Marquez Benitez has all the candor and precision of an observer and a writer. President Manuel L. Quezon is always “Don Manuel.” He is temperamental and the stories handed down to us about this man who would not stop himself at uttering the expletive “Animal!” is indeed true, when somebody deserved that. And always, the crime is social—the lack of manners. In one account, walking around the University of the Philippines, the President chanced upon a classroom where one engineering student had his legs propped up on the seat in front of him, Quezon berated the offender and the teacher, a certain Professor Albert, who did not check on the behavior of his students. Justice Jose Abad Santos is here. He is “Jobad,” a good friend of Francisco Benitez, the husband of Paz. The Japanese executed Abad Santos because he refused to cooperate with them. Here is Sergio Osmeña, scrupulously honest and losing the election to Manuel Roxas because the former refused to make promises he would not be able to fulfill. Here is also Vicente Sotto Sr. of Cebu, who asks Osmeña to make a public statement of support for him, in exchange for his services of attacking “whomever you say, libel anyone you tell me to libel…” Then there is Quezon. Paz Marquez Benitez writes in an entry on August 17, 1944, the following: Don Manuel is dead—has been
dead for over two weeks…Don Manuel, lover of the dramatic, could not have made a more dramatic exit. From Baler, obscure seacoast village to a funeral in Arlington—quite an incredible journey. Paz continues: It was time to go; his role in our history is over. The time to build has come and Don Manuel is not the man for that. Irascible, intolerant, impatient, and domineering, he was a destroyer, not a builder of men. Paz Marquez Benitez’s letters had those years of terror—escaping from the cazadores, the Spanish soldiers who were called hunters; hiding from Americans, and; being terrified of the Japanese. When she built her home with her husband, Dean Francisco Benitez, the street where the home was built was to be known as “Easy Street.” A diary in 1945 contains these lines: Since I last wrote in this book, the world has changed utterly; myself not the least. So many things, sad, bad things, have happened, so many people have died. Memory, more than the stately narratives of historians about histories demarcated for their grandeur, can tell with ease the plots of the people of any nation. The memories of this great writer, Paz Marquez Benitez, relate paths that are least trodden by pedants and chroniclers and bring us what Gustave Flaubert says of memory—that desire one misses. And desire is what we need when the world has become a sad, bad thing and many people each day die in the hands of an uneasy government.
E-mail: titovaliente@yahoo.com
Be ‘prepared for anything’ as Trump slams Europe, China on FX By Katherine Greifeld Bloomberg Opinion
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NITED States President Donald J. Trump’s latest accusation of currency manipulation has foreign-exchange analysts game-planning the administration’s next move. Trump tweeted on Wednesday that Europe and China are playing a “big currency manipulation game,” days after he declared a tariff ceasefire with Chinese leader Xi Jinping. For market observers, the president seemed to suggest going beyond mere jawboning. His call to “Match, or continue being the dummies who sit back and politely watch as other countries continue to play their games” has strategists considering the possibility that the US Treasury could intervene to weaken the dollar. The US hasn’t intervened in FX markets since 2011, when it stepped in to strengthen the dollar as part of an international effort after the yen soared in the wake of that year’s devastating earthquake in Japan. But with Trump’s repeated complaints
about dollar strength—even after the US refrained from formally labeling China a currency manipulator at the end of May—anything is on the table, according to Canadian Imperial Bank of Commerce.
Presidential ‘obsession’
“The obsession with currency manipulation—a month after the last Treasury report had different conclusions—means we should be prepared for anything,” said Bipan Rai, CIBC’s North American head of foreignexchange strategy. “The Treasury hasn’t intervened to weaken the dollar for decades, but we wouldn’t be surprised if that changes potentially under Trump.” The euro touched the day’s high on Trump’s tweet on Wednesday before retreating. The latest missive did little to rattle the offshore yuan. The Bloomberg Dollar Spot Index is down about 0.5 percent this year, after a 3.2 percent gain in 2018. But using a Federal Reserve tradeweighted measure, the dollar is not far below the strongest since 2002, which threatens to make US exports
less competitive abroad. The risk of intervention increases should the Fed decide not to ease policy at its meeting this month, Rai said. Trump has staged a campaign against Fed Chairman Jerome Powell in recent months, comparing the central bank to a “stubborn child” last month for not cutting rates.
Only game
Trump may ramp up his jawboning efforts as other major central banks start to ease, said Anthony Doyle, global cross-asset investment specialist at Fidelity International. “I wouldn’t be surprised if jawboning was to increase in coming months,” Doyle said in an interview with Bloomberg Television. “Generating inflationary pressures, generating competitiveness through a lower currency is one tool that central banks can use to support their economies and it’s the only game in town at the moment.” European Central Bank policymakers aren’t yet ready to rush into additional monetary stimulus at the July 25 meeting, according to
euro-area central-bank officials familiar with the matter. Still, the Governing Council members may tweak its policy language this month to signal more stimulus is imminent, they said earlier this week. Ng Kheng Siang, Asia Pacific head of fixed income at State Street Global Advisors, said Trump’s jawboning efforts could continue if the ECB eases and the euro weakens. “Clearly if he feels that the US interest is not served, in his eyes, he’ll start to poke and even blast at anyone,” Ng said. Even if the Fed does lower rates in a few weeks—a move that bond traders overwhelmingly expect—that might not be enough for the president, according to Bank of America Corp. “The president is likely to get his way at least for the time being,” foreign-exchange strategist Ben Randol said via e-mail. “However, the problem arises if US economic outperformance continues and the dollar proves accordingly resilient,” he said. “In that case, the temptation to intervene in FX markets will increase if Fed cuts don’t do the trick.”
Reptile invasion: Florida agency encourages killing iguanas By Curt Anderson The Associated Press
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Developed by Alvin Ang
Friday, July 5, 2019 A11
ORT LAUDERDALE, Florida— Non-native iguanas are multiplying so rapidly in South Florida that a state wildlife agency is now encouraging people to kill them. A Florida Fish and Wildlife Conservation Commission news release says people should exterminate the large green lizards on their properties, as well as on 22 public land areas across South Florida. It doesn’t say just how civilians
should try to kill them. “Homeowners do not need a permit to kill iguanas on their own property, and the FWC encourages homeowners to kill green iguanas on their own property whenever possible,” the agency says. Iguanas aren’t dangerous or aggressive to humans, but they damage seawalls, sidewalks, landscape foliage and can dig lengthy tunnels. The males can grow to at least five feet (1.5 meters) long and weigh nearly 20 pounds (9 kilograms). The commission says female iguanas can lay nearly 80 eggs a
year and South Florida’s warm climate is perfect for the prehistoric-looking animals. Iguanas are native to Central America, tropical parts of South America and some Caribbean islands. “Some green iguanas cause damage to infrastructure by digging burrows that erode and collapse sidewalks, foundations, seawalls, berms and canal banks. Green iguanas may also leave droppings on docks, moored boats, seawalls, porches, decks, pool platforms and inside swimming pools,” the wildlife commission says. They also can carry
salmonella bacteria. Like other nonnative species, authorities say iguanas brought to Florida as pets or hitchhiking on ships have begun to flourish in the state. Another invasive species, the Burmese python, is wreaking havoc in the Everglades because the big snakes eat almost anything and have no natural predators in the US save for the occasional alligator. Iguanas are allowed to be kept as pets in Florida but are not protected by any law except anti-cruelty to animals, according to the commission.