Financial Crisis: The Philippine Version

[jpdm]

why is it the GOVERNMENT always has to do everything?

can't the people help themselves?

do we live in a nanny state?

Well, who are you referring to?

How about this statements that you made?

The nanny here is the government. Big companies need the support of the US FED

Cant these big companies help themselves?

If people, especially militants ask for doleouts, its nothing kasi barya barya lang ...but when you nanny big companies it hurts..they need big money for them to be bailed out...Di lang AIG sabi mo pati Goldman Sachs..

In the case of the US as you said, the small ones are not bailed out.Manigas sila.pero big ones kailangan ng yaya o nanay o benefactor.

Hay pag mayaman o malaki ka ok, pag militante hindi...Dapat pareho di ba...


So much for these "fittest."

Lampa rin pala.

the Fed lent money to AIG so AIG could pay its obligations to counterparties who won in the derivatives bets.

in effect, the Fed is protecting the counterparties, not AIG.

The Fed loans are actually very very punishing on AIG... to the point napilitan ang AIG magbenta ng ari-arian.

It's clear naman who the Fed is favoring. And it's not AIG.

---

Yes, the US is bailing out financial institutions.

here's where survival of the fittest applies:

If u are just a small ailing bank, the FDIC shuts u down.

If u are a small business or just an individual, and you get in trouble, nobody is gonna bail u out.

To get a bailout, u have to be big. As in very very big. Super interconnected with everyone...

So big that if u fail, u take the whole world down with you.

That's when u get bailed out.


You're thinking kasi pag na-bail out ka ng govt or pag nakialam ang gobyerno, di na nag aaply ang survival of the fittest.

Remember, the govt is PART of the biosphere. Part sya ng environment. So players or competitors use links to the govt as a survival strategy.


It's a survival advantage if u got connections.

[jpdm]

why is it the GOVERNMENT always has to do everything?

can't the people help themselves?

do we live in a nanny state?

This will answer your question...

If a businessman is close to someone in Malacanang, and he is able to get his goods out of customs without paying proper taxes, then he has a competitive advantage over a businessman who has no connections in Malacanang coz he has to pay full taxes.
so that makes the businessman with connections is "fitter" than the other businessman. Gets?

Or if a company that is engaged in a certain industry lobbies the govt not to allow other companies to compete with them in that same industry, then that is their survival advantage.

That happens all the time here.

Diba u are the one who is always saying meron oligopoly dito sa atin?

well, how is that oligopoly being maintained?

The top businessmen in the country have friends in the highest places in govt.

[SIZE=3]They exist for mutual benefit. I make you rich, u make me rich.
[/SIZE]

_______

Goldman Sachs.

Goldman Sachs is a large counterparty of AIG.

AIG owed billions to Goldman in derivatives bets.

AIG was bailed out so Goldman would get paid.

The fitter one, the winner is Goldman Sachs.

Somebody very powerful is looking after Goldman.

[jpdm]

As I said, ULS, its better to just give barya-barya dole outs to militants and protesters, instead of giving the whole vault of dole-outs to big voracious corporations..

The poor taxpayers and shareholders including militants and protesters will be the loser in the end...

This bail out plan for big corporation is a big pain in the neck of many US taxpayers..

It also unraveled the so-called Free-market...

Now, with 80% of AIg owned by US taxpayers US government)--what kind of economic ideology is this??

SOCIALISM (a.k.a. capitalistic term-Welfare State or Mixed System) -a militant government that actively intervenes in the economy...

Yan ang USA, champion ng laissez faire-neoclassical-globalist capitalism...

Mas gusto ko pa France and Sweden...aminado na may pagka socialist-democrat sila...

Business Mirror
November 4, 2008

AIG Rescue May Fail, Analysts Say

WASHINGTON—A number of financial experts now fear that the federal government’s $143-billion attempt to rescue troubled insurance giant American International Group (AIG) may not work, and some argue that company shareholders and taxpayers would have been better served by a bankruptcy filing.


“No one else benefits,” former AIG chief executive and major shareholder Maurice “Hank” Greenberg wrote to AIG’s current chief executive on Thursday. “[SIZE=3]Unless there is immediate change to the structure of the Federal loan, the American taxpayer will likely suffer a significant financial loss.”[/SIZE]


Another concern is that in this depressed market, AIG, and the taxpayers that now own 80 percent of the company, will lose coming and going.


The company may be forced to borrow additional federal funds for rising payouts to counterparties.




The Federal Reserve and its advisers have acknowledged privately that things are not going according to plan. As AIG has rapidly eaten through the loan money, [SIZE=3]the Fed has twice expanded its original $85-billion bailout—which itself was the largest government bailout of a private company in US history.[/SIZE] (The Washington Post)

[tidus1203]

Yep what the US is doing right now is socialism for the rich but it also comes down to survival of the fittest. These people are TOO BIG TO FAIL ika nga by the US government. If they fail it will have dire consequences for everyone even those who are not involved. Kaya everyone wants to become TOO BIG TO FAIL

[uls]

haha

HEY! i wanna be too big to fail too

---

The company may be forced to borrow additional federal funds for rising payouts to counterparties.

That's where the biilions AIG borrowed goes to...

paying counterparties.

Nakipagpustahan ang AIG... natalo sya... kelangan nya magbayad

Declare bankruptcy? No way. Ano sya? sinuswerte? easy way out?

Kelangan magbayad ang AIG.

Hindi mga small time ang kapustahan ni AIG... mga predators yan.

Top of the food chain.

You don't lose bets with Goldman Sachs and not pay up.

AIG board members discussed a growing dispute between AIG Financial Products and Goldman Sachs about the value of those assets when Goldman called for AIG to post collateral. AIG's chief financial officer warned of "Goldman's acknowledged desire to obtain as much cash as possible."

When you owe Goldman money, you better pay up.

Walang pambayad? Maghanap ng pambayad. Mangutang.

That's why AIG was bailed out by the US.

Ganyan kalakas ang Goldman Sachs.

[uls]

BTW, who says hedge funds can't make any money these days...

For the month of October, Greenlight Capital Qualified, L.P. returned 13.2% (net of all fees and expenses). Greenlight Capital Qualified, L.P. has returned 26.4% for the year-to-date.

that hedge fund is run by David Einhorn

Dude with killer instinct

---

AIG will keep on borrowing more money

Coz it will end up having to pay $300B to $400B to counterparties... maybe more...

That initial $85B loan is no way near enough...

The bailout wasnt intended to save AIG...

The bailout was intended to save AIG's counterparties.

I've been saying that weeks ago in the "AIG facing liquidity crisis" thread

[jpdm]

. Kaya everyone wants to become TOO BIG TO FAIL

haha

HEY! i wanna be too big to fail too

bee careful of what you wish for..you might end up just like Enron and Lehman...

[jpdm]

Yep what the US is doing right now is socialism for the rich but it also comes down to survival of the fittest. These people are TOO BIG TO FAIL ika nga by the US government. If they fail it will have dire consequences for everyone even those who are not involved. Kaya everyone wants to become TOO BIG TO FAIL

Using the term of one poster here, the US FED is the nanny of these supposedly big companies-the "fittest"

and yet..

Without this US bailout plan, AIG and Goldman Sachs are both wimps that the US taxpayers should have not rescued....

[ocanursjr]

As far as i know matagal ng krisis sa atin.

Widening gap between rich and poor.
Poverty level is on the rise.
Corrupt government official.
Greed
Many to mention guys...

[True Faith]

It will take around 2 or mare years to solve the financial crisis in the US...(according to Pres. Obama)

...In the Philippines kaya?or are we in perpetual financial crisis (plus fifth in world hunger)

..Its a good thing Philippine banks are very very conservative....

..Pinoys despite their wasteful spending...buy products in cash and not through plastic money....

[uls]

Philippines?

Crisis? What crisis?

according to jpdm

Our land is very fertile. Volcanic in origin. We can plant any crop in the Philippines...

Our country is still relatively big in terms of land area..we are still bigger that Britain or of course tiny Singapore...

Our seas yield lots of food (fish, crustaceans) and resources (oil, natural gas)

Our lands is rich in mineral resources (one of the most mineralized i.e. nonoc island alone if properly developed can yield large amount of nickel--the country in fact is one of the biggest producer of nickel)

Gold, silver, copper, manganese, nickel, chromite, phosphate, iron can be mined in the country..

Still the world's largest producer of copra and abaca..

World's second largest producer of geothermal energy..

Has one of the largest coastlines in the world...

We have the best natural wonders and places in the world that can be FULLY harnessed for tourism..

A big pool of human resources

A big potential market...

what crisis?

mayaman ang Pinas.

[jpdm]

Philippines?

Crisis? What crisis?

according to jpdm


what crisis?

mayaman ang Pinas.

Your conclusion above is definitely incorrect.

let me explain..

Per se, the Philippines is resource-rich compared to industrialized and prosperous Japan, Korea, Taiwan and Singapore.

Yet we are prone to these financial crisis and other crisis...

The US is still rich despite the financial turmoil.

[True Faith]

I agree with jpdm, the country is resource rich, but the problem is poverty is widespread because of the terrible income inequality in the Philippines...

If there are 20 million Pinoys with just $1 a day income, there are rich Pinoys who can put 6 billion US dollars outside the country...

[True Faith]

Philippines?

Crisis? What crisis?

according to jpdm


what crisis?

mayaman ang Pinas.

Indeed, again the country is supposedly well-off. We have oil and mineral resources etc..

But because of these ULS (see below regarding under the table transactions and rent seeking malpractices), and how you seems to justify it and some unscrupolous people in the government, in the private sector, other businessmen and even the Pinoy public, kaya nagkakapeste peste Pilipinas at prone sa ibat ibang krisis...

You said it ULS, based on your own words, these are the various reasons why we are in perpetual crisis despite having all the potentials mentioned by jpdm...

If a businessman is close to someone in Malacanang, and he is able to get his goods out of customs without paying proper taxes, then he has a competitive advantage over a businessman who has no connections in Malacanang coz he has to pay full taxes.

Or if a company that is engaged in a certain industry lobbies the govt not to allow other companies to compete with them in that same industry, then that is their survival advantage.

That happens all the time here.

Diba u are the one who is always saying meron oligopoly dito sa atin?

well, how is that oligopoly being maintained?

The top businessmen in the country have friends in the highest places in govt.

And this your conclusion using your 'survival of the fittest' paradigm...

They exist for mutual benefit. I make you rich, u make me rich.

That's the survival advantage of the top businessmen in the country. They are connected to the highest govt people in the land.

[uls]

Sad no?

That's the status quo.

[jpdm]

Sad no?

That's the status quo.

Then, why are you complaining about the unfriendliness of government towards business?

What you have mentioned are the reasons why government is unfriendly to businesses that do not have connections...

and...if fact you are justifying it...

Kung anong tinanim yun ang aanihin...

Thats why Im fighting about a fair game. If we dont tolerate it...perhaps we can create a business-friendly environment with no wheeling and dealing...a free market without greedy and corrupt oligopolies and monopolies...

[tidus1203]

Some people are still in a state of denial about the true ways of doing business here. Its not about being right or wrong, its the way it works whether we like it or not. So we gotta adapt. We gotta survive.

[jpdm]

Some people are still in a state of denial about the true ways of doing business here. Its not about being right or wrong, its the way it works whether we like it or not. So we gotta adapt. We gotta survive.

Thats why we are Asia's most corrupt country...

People are advocating that we should just adapt and tolerate this kind of deep-seated corrupt practices..

Have we lost our sense of moral uprightness?Is it not really possible if not eradicate it minimize it?

This crisis in the US was to a certain extend brought by greed also..

And we are going to duplicate it here?

[tidus1203]

Then you guys go change it I would love it if you can. Ako I'd rather adapt to the environment then try to be a hero its much easier that way. I am more interested in protecting myself and my family rather than society as a whole. Sorry if you don't like the way I view things but that is me.

[Gen. Miting]

i agree with fighting fire with fire but do always make an effort to make a difference if you'll know the end game will be bad.