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  1. Join Date
    Nov 2005
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    45,927
    #131
    pero as a consumer, you don't get zero rates

    the zero rate is for the banks

    the Fed lowered rates to encourage banks to lend,

    since zero ang interest ng Fed loans para sa mga banks, the banks are supposed to pass the low rates to borrowers

    kung dati 7% charge nila sa borrower, and the Fed charges the commercial banks 2%

    5% kita ng mga commercial banks

    Ngayon zero, the banks can lend at 5% to the borrower and still make the same profit

    But in the real world, it's not working

    banks are not passing the low rates to borrowers

    banks are not lending... not much

  2. Join Date
    Feb 2008
    Posts
    14,181
    #132
    In the UK they are forcing banks to pass it to the consumers, I suspect in the US gagawa ang mga lawmakers ng batas to pass it if not they will be violating a law... Alam mo naman ang mga pols they need to show that they are doing something even if it some of it is absurd...

  3. Join Date
    Nov 2005
    Posts
    45,927
    #133
    kaya abnormal ang financial system ngayon

    ang mga bangko ayaw magpautang

    the Fed became the lender of last resort

    actually, lender of only resort

    the financial system is being kept alive by the Fed's alphabet soup lending facilities (TAF, PDCF, TSLF, MMIFF, CPFF, AMLF ETC)

    ---

    but the commercial banks have a reason for not lending

    dami na nila bad loans

    the last thing they need is more bad loans

    consumers and businesses are in trouble

    the banks are not very enthusiastic to anyone

    tapos the governments wanna force the banks to lend

    excellent

  4. Join Date
    Feb 2008
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    14,181
    #134
    That's the problem of forcing banks to lend. The banks are smart enough to know which loans are potential bad loans so they don't wanna pass it for the most case or at least if they do want to lend they will lend at a higher rate to offset the potential risk. But by forcing the banks to lend (even to undesirables) with low rates could make it worse for the banks who are already hurting from previous sour loans. The pols of course again have to show off to their constituents they are trying to do something.

  5. Join Date
    Nov 2005
    Posts
    45,927
    #135
    kaya sa crisis na ito, there's no easy solution

    if they do nothing, bad things happen

    if they do something, there are unintended consequences

  6. Join Date
    Jun 2007
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    2,854
    #136
    The Philippine peso is expected to be weaker against the US dollar by end-2009 on the back of a slower economic growth, a bank executive said. Jonathan Ravelas, Banco de Oro Unibank (BDO) chief market strategist, said the peso is likely to end at P48.50 against the greenback this year compared with the closing level of P47.52 during the last trading day last year. He added that currency would remain volatile as it may swing between the P45.00 and P52.00 level.

    Manila Times
    January 2, 2009
    Let us see...

  7. Join Date
    Dec 2005
    Posts
    39,162
    #137
    ^^^ Slower economic growth because there are fewer OFWs that are earning the oh-so-precious $$$ for the country. They're the ones who are keeping the economy afloat. Parang mga ampaw ang mga industriyang nandito sa Pilipinas....

    7202:bruce_lee:

  8. Join Date
    Jun 2007
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    2,854
    #138
    Quote Originally Posted by CVT View Post
    ^^^ Slower economic growth because there are fewer OFWs that are earning the oh-so-precious $$$ for the country. They're the ones who are keeping the economy afloat. Parang mga ampaw ang mga industriyang nandito sa Pilipinas....

    7202:bruce_lee:
    True primarily because they are import dependent.

    So vulnerable to external (overseas)shocks.

    Our industries should start re-tooling and use more local materials to be a little bit sturdier from international fluctuation of world commodities.

    Sayang ang remittances of OFws and export earnings natin-- most (all of them pala due to our massive trade deficits)of them go out to pay for our massive (most of them can be produced here and non-essential imports)importation of goods and services.

    No wonder we have the lowest GIR in Asia and paltry compared with China, Japan and Little Taiwan with almost a Trillion dollar GIR.
    Last edited by jpdm; January 2nd, 2009 at 09:04 PM.

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The Losing Power of the Pinoy Peso-- Again!