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The strengthening peso


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A_Simple_Man
If I remember correctly, Ben Diokno warned against the "Strong Peso" and thought it should be pegged at 50 to the Dollar

With a little research I found the same thing, but that was in 2008. The more recent stuff is still pretty good though. Did you see this one that he wrote last month:

Exporters hurting badly

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A lot of "economic experts" have never been to the Philippines. Experts have been predicting growth in the Philippines for the last forty years. Those experts don't understand the situation on the gro

They will adjust, or they will find somewhere cheaper to live.   Liberals / Democrats: If you click this spoiler, do not give me shit about it. You have been warned:    

It is not just the US dollar going down! The Philippine economy is moving forward. There are a lot of dollars moving into the Philippines through the stock market. This is known as "hot money" because

With a little research I found the same thing, but that was in 2008. The more recent stuff is still pretty good though. Did you see this one that he wrote last month:

Exporters hurting badly

 

They should try making and selling more items Made in the Philippines. When shopping in the stores in the Philippines I hardly ever find clothing with Made in the Philippines tags on them. Instead of seeking items made outside the Philippines Filipinos should create a proud society of people who want to help their own country by filling stores with their own products and buying their own products and to make sure those products are made to a good quality standard. I find it a shame that I have to go to the US to buy shirts Made in the Philippines and for less than I can buy shirts in the Philippines for.

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... and has even resorted to the ancient conservative practice of actually raising taxes to help pay for something.

 

You still cannot get blood from a turnip. The vast majority of people in the Philippines do not have money to live on, much less money to pay the government in taxes.

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InternetTough

You still cannot get blood from a turnip. The vast majority of people in the Philippines do not have money to live on, much less money to pay the government in taxes.

 

When South Korea was poorer than the Philippines is today, the central government was the only Korean entity with real capital for investment. Accordingly, it took a lead role in the economy. (One of the first things it did was build the Seoul-Busan Highway---before they had many cars or trucks!) Try it yourself one time. When you can tax everyone in the land a little bit, it adds up.

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InternetTough
2012----------2.45% (This is 65% more than Diokno's 2011 figure---it is not actually his figure)

 

ERRATA---this figure, 2.45%, is actually only the end of October figure for this year. Probably this year's total would be somewhat higher.

 

This shows a real increase on all past expenditures going back to 2006.

 

(And Diokno said that the 2012 (End October) infrastructure spending was 65% higher than the total 2011.)

Edited by InternetTough
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ERRATA---this figure, 2.45%, is actually only the end of October figure for this year. Probably this year's total would be somewhat higher.

 

This shows a real increase on all past expenditures going back to 2006.

 

(And Diokno said that the 2012 (End October) infrastructure spending was 65% higher than the total 2011.)

Yes he did as measured against what was spent, which in turn was grossly underspent against the budget for that year. when you have a low base figure getting 65% increase was not hard.

 

I believe he made an observation similar to that.

 

 

I think the overall point he was making was that if you have a budget..spend it, do not make it a savings figure because you did not spend what you agreed to etc

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InternetTough

So, 2012 might be 2012 2.55, 2.65 or more---significantly higher than any year since at least 2006.

 

Yes, it is strange to budget spending but then not spend it.

 

I was trying to justify quoting the end October 2012 figure as Diokno's, because I took his 2011 figure, looked at another statement of his in another article (+65% by end October 2012) and used my calculator.

 

There seems to be improvement in infrastructure spending.

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Thank you for your recommendation of Ben Diokno.

 

professor diokno is indeed a good read. as is his daughter's father-in-law gerardo sicat. see for example:

 

The Peso Appreciation and Monetary-Fiscal Coordination – by Gerardo P. Sicat

 

http://www.econ.upd....iewFile/698/166

 

 

Abstract

 

 

The Philippine peso appreciation has been creating serious problems for the economy because of the high degree of unemployment and poverty incidence in the country. More specifically, it threatens contraction of the export sector through loss of competitiveness. The paper tracks the exchange rate experience of the Philippines with four other East Asian neighbors and finds that the Philippine appreciation is most severe. The paper asserts that exchange rate policy is a matter of policy discretion even under the regime of market-based exchange rates. Options for monetary policy in curtailing domestic liquidity are discussed. Finally, the options for improved coordination of monetary and fiscal policy are suggested.

 

 

 

raul fabella, also highly recommended, used to write a lot about the peso and the problems of overvaluation.

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