Many “activists” allied with the Yellowtard-led Philippine Opposition have been screeching about the slide of the Philippine peso against the US dollar — hinting that this is indicative of mismanagement of the economy by the government of Philippine President Rodrigo Duterte.
The fact is, it is not entirely true that the peso is depreciating against the dollar. This is because the value of the US dollar has actually been rising against many other currencies over the last several months. Many affected countries are taking steps to address this trend in interesting ways…
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With the rising US dollar, emerging market central banks have tried to preserve their wealth with Russia, Turkey and Kazakhstan leading the charge and accounting for 85 per cent of the total purchases.
Since the beginning of 2017 to July 2018 Russia has added 383.3 tonnes of gold, Turkey 125.8 tonnes and Kazakhstan a heavy 68.4 tonnes.
All three countries have seen their currencies lose significant value against the greenback this year.
Then consider China…
China is the world’s largest producer of gold, with nearly all of what is mined staying within its borders. So we can safely assume that China’s central bank would be near the top of the list for gold purchases.
Filipinos have lots to learn — specially from years of a misguided embrace of globalisation, wanton export of raw commodities and minerals, and reliance on labour-added-value production rather than focusing on building a robust base of capital-intensive industries that produce high-quality and high-valued finished products.
The vulnerability of the peso is underpinned by this underlying weakness of the Philippines’ industrial base. Exports, though strong, are enabled by a large input of imported raw materials and capital. Domestic consumption too is fed by a vast trove of imported goods rather than by a resilient domestic production capability.
It is important that misinformed politics be scraped off the public debate surrounding the national economy. Only this way will an intelligent framing of the issues be achieved and the right solutions identified.
benign0 is the Webmaster of GetRealPhilippines.com.
The will to solve problems inhabits only a few in this world. Lesser people are content with complaining, scapegoating, spilling blood.
My suki fish vendor doesn’t know about peso depreciation. She doesn’t know how it affects cost of living. She doesn’t even know inflation. “Inflation? Wat is dat?”
So does my suki jeepney driver. All he knows that gas prices is going up !
well explain to your two suki’s what’s inflation.
Just an example, one of the products Philippine industries should really start manufacturing its own, is the tin-sheets use in manufacturing sanitary/beverage tin-cans (for canned foods/drinks). We know how to produce tin-cans but the main component of these, the tin-sheets, are ordered abroad!
The demand for this material in the country is so huge because Filipinos indulge too heavily on canned-foodstuffs, and yet the Philippines seems not interested in producing its own tin-sheets– while users of this product, the canning companies, are almost always complaining of the impact of the peso-dollar exchange rates differential and point their fingers at the exchange-rate movements for the price increases they’d apply on canned-goods!
I bet the last remaining colonists would indulge in this industry employing ex-slaves former slaves with above average wage + benefits.
Brown skin punk’d nose Filipinos enslave their employees paying them below legal wage.
MABUHAY KAYO MGA LAST REMAINING COLONISTS …. !!!! MABUHAY !!!!
The Trumph administration made the U.S. economy on top again. The U.S. has the lowest unemployment. The U.S. factories are back working full time. U.S. exports are on top , and are on demand again.
Most of the worlds’ economy are affected by the rise of the U.S. economy, the Philippines included. Pres. Duterte has nothing to do with it.
Even if the Aquino Cojuangco political axis and their opposition allies, would be back in power. We would have the same, or worse situation in our economy.
Do not politicize , everything, to put down people in power, in order to regain your power. We the common Filipino people are the ones to suffer most by your greed of power . Anyway, you lost in your recent “kudeta attempt”. Trililing Trillanes is still TNT (tago ng tago), in the Senate, protected by that comedian, Sotto.
When there is fast-faced economic activity there is likely an inflation …
If there is an inflation the currency tanks …
That is why 1stWorld countries central banks increase discount rate to tamp down unfettered economy.
In US-China tariff war China cannot respond dollar-for-dollar in tariffs because China export more than it imports from the US. What China does to mitigate the tariffs the American consumers get to absorb Chinese DEPRECIATE THEIR YUAN.
Unfortunately, Philippines has very little to export except their people. Their economy is more import and slave driven. If peso depreciates import prices rice and the Filipinos suffer. If one is a slave OFW their remittance recipient gets the benefit.
So, it is best to turn Filipinos into export slaves because they have very little capital.
Here is quick-and-dirty calculation why OFW is better.
1. 10% of Filipinos are exported abroad. That is 11,000,000 Filipinos are slaves.
2. each of 10% Filipinos has, conservatively, one sibling, a father and a mother that is 4 of them
3. 4 multiplied by 11,000,000 equals 44,000,000 Filipinos
4. divide 44,000,000 by 110,000,000 equals .4 … conveerting that into percent that is 40% of Filipinos relies on OFW !!!! THAT IS A LOT OF FILIPINOS !!!! nearly half close to half are dependent on OFWs
5. So what remains are 60% of Filipinos …. according to Duterte the unemployment rate is 7.5% so, 7.5% of 60% are unemployed …..
6. According to Department of Finance 50% of the employed makes 250,000 or less a year ….
8. At the rate of one killings a day in 365 days there are 365 days … and they are mostly self-employed … yeah, Virginia, Drug dealing self-employed …
MABUHAY SI DUTERTE ….. !!!!!
It’s okay to be dependent on OFWs as long as they are happy to take on the role of martyrs and saints, this is the only solution of the the government can give, who knows one day Duterte will also hail them as heroes for enduring pain and hardship, just as all the past leadership have done because they can’t do anything much, but we all know that when Pilipinos are praised as heroes, they are all smile and hands clapping.
If the Pilipino don’t understand the money system economy, which clearly they don’t, then the Capitalist system is not for them.