Philippine Debt Management Issues: Seeking Approval

Saturday, April 23, 2005

Seeking Approval

Seeking approval prior to incorporation

23 Comments:

Anonymous said...

BSP giving imprimaturs to business plans of organizations seeking licenses to operate.... organizations applying even before issuance of a regulation or rule......the circular was dated July 2003 and the letter was as of April 2003.....will somebody please explain these anomalies?

I am flustered...

10:37 AM

Anonymous said...

The evidences as presented already confirms the anomalous intents and motives of the Castillo group and the connivance of the BSP leader. They still intend to push through with this? ANG KAPAL!

11:20 AM

Anonymous said...

Did the other custodians apply for accreditation at about this time? April? Before circular 392 was released in July 2003?

Can someone please reconcile these dates?

1:51 PM

Anonymous said...

i AGREE WITH THE POSTER ABOVE, CAN A GOOD GOVERNANCE GURU PLEASE SPEAK UP AND EXPLAIN WHY WE ARE IN SUCH FILTH? WHY THE SYSTEM IS SO DECADENT?

1:57 PM

Anonymous said...

It seems that source of the problem is Castillo. Who the hell is this guy anyway? Better yet, who the hell does he think he is?

10:25 PM

Anonymous said...

Well, it takes two to tango... so the question is, who is his partner in BSP? Or is it a wild "barkada" party?!

8:34 AM

Anonymous said...

Say Amen brother... that's what is so sad about this country...

8:00 PM

Anonymous said...

I would like to invite everyone on this blog to congratulate the PDS HOLDINGS CORP and PHILIPPINE DEALING & EXCHANGE CORP on its successful implementation of:

1. The most disorganized "organized market";
2. The most chaotic "efficient market" and;
3. The most divisive "centralized market".

Congratulations folks!!!

Unfortunately, after viewing your excellent track record your services as a custodian will not be necessary.

11:54 AM

Anonymous said...

this is for the author of this blogspot: hindi ka na nag-iisa. marami na kayo. Kasama mo na si Valbuena, Yorac and even, Vic Corpus. They did not want to implement something that would be detrimental to the Filipino people. Soon, Senares of NLRC may even be joining you.
What's happening now with the third party custodianship issue? Please update us. Thanks.

10:58 AM

Anonymous said...

donj: what are you taking about???

3:24 PM

Anonymous said...

To Mr. DONJ:

Who cares about PDS, BTr can live without them. PDS can go to Senate or any court if they want to... at least they can have a chance to explain how in the earth BSP came up with circulars that clearly originates from their end.

10:22 AM

Anonymous said...

To donj

Now I am convinced that you don't really understand what you are talking about....

11:30 AM

Anonymous said...

Donj: What is your understanding of the difference between OTC trading and Exchange trading?

Regardless of what your understanding is, the brand of third party custody preached by PDS is not necessary when you have an electronic, book-entry transfer of securities direct on registry.

12:15 PM

Anonymous said...

Paging...the Joker

Pakipaliwanag mo nga ulit ke donj for the last time good points ng OTC in terms of price and spread versus the Exchange.... just for the last time, kung di pa rin ma 'gets' hands up na tayo - bigay mo na ang nag-iisang si donj kay FIE!

1:46 PM

Anonymous said...

And lets say "Amen "to that in chorus.

4:46 PM

Anonymous said...

mahirap makakita ang nagbubulag-bulagan, mahirap makarinig ang nagbibingi-bingihan at lalong mahirap makaintindi ang walang pinaniniwalaan (bukod sa kanyang sarili!!!)

The Joker has eloquently discussed the issues point by point which evidently donj cannot comprehend.

You are an investor not satified with OTC because you need to call several dealers. In the first place, why do you need to call a several dealers when you said you are just ordinary investor? Have you heard about the role of the broker?

Spreads are wider which is not good for trading - What is your basis? Did you run a historical data for OTC transactions and found out that the spread is really wide at 5% level of significance? What is your definition of wide spread? 10, 15, 20...basis points?

Donj, you are confusing yourself, you want to be clarified as an investor but you are chaotically talking about trading? Which is which, or better we simply accept that you don't really has the capacity to understand the investor's vis-a-vis trader's issues.

It will be a waste of time for the Joker to explain again, it's as if your are teaching mathematical operations and the student does not even know how to count...so I guess we better rest our case.

Donj, look for a new avenue to learn -- perhaps do it in your own time, reading research papers or even text books in finance or better yet, enrol in a reputable school.

5:33 PM

Anonymous said...

Hypothetically:

Case 1 - OTC (individually calling the "dealers" about the bid/ask price
Bank A 9.500/10.200
Bank B 9.750/10.125
Bank C 10.000/10.250

Case 2 - FIE (in one board i.e. the PDEx website? since Donj is just an ordinary investor therefore will not be subscribing to an expensive terminal)
Bank A 10.750/10.800
Bank B 10.850/10.900
Bank C 10.900/10.950

Donj, di ba ang choice mo is case 2? transparent ang price and smaller ang spread right?

Ayan,that's what you get for subscribing in a very expensive platform, US$1,000 per terminal per module per month plus PHP900 per transaction. Do you think the banks who will incur this huge cost will not factor it to their prices? The banks are not in the business of losing money, this cost will be factored in their YTM/price and you Donj will be the one paying as you preferred! Goodluck!

Probably the banks will thank you for your generousity!!! You will be one of those investors helping them recover this no-value added-high cost subscription in the FIE.

5:54 PM

Anonymous said...

To the above poster ... no need na for the Joker, fully and satisfactorily explained...hahaha! So donj, di mo pa rin gets? Goodbye na and goodluck to your FIE.

6:02 PM

Anonymous said...

1. The market for debt is composed of the issuer, the intermediary and the investor. Issuers float debt either for commercial or for capital reasons. Intermediaries may either be dealers or brokers. Investors may either be trading, hedging or investing. These are diverse needs. They need equally diverse solutions. The current formulation of the OTC market is definitely not the proper way of spot securities distribution but foisting an Exchange is definitely not the way either. That is the biggest failure fo the FIE in its implementation - believing it could address the whole market by consulting one section of the market while conniving with the regulators.

2. Unlike share prices that are merely representations of the value of a company interest rates are of seminal interest in the national economy. The debt markets are not slot machines for investors to simply punt (buy-low, sell-high) causing yields to gyrate all over the place. That manner of volatility makes issuance of debt and with it conduct of business completely unattractive. We have enough going against our country in terms of business environment.

3. Your assumption of access to the best price in any market OTC, Exchange or whatever is tenuous. If you do not have established relationships with the owner of the best price (ie depositary or credit) there is slim to no chance of your dealing that price. This FIE creature of yours is not a central counterparty.

4. Where is the liquidity needed to power your government securities exchange when on the issued date of a government security 100 percent of the issue is in the hands of the dealers - whose market by definition is OTC?

5. Where is the private securities market coming from given the investment houses that float private debt have been priced out of the market?

These are but some of the really serious issues facing the market. The FIE is nothing more than a half baked solution that has harmful side-effects in its attempt at a cure.

If you still do not understand, please read up. You have been foisting the same argument with no substance whatsoever.

You are probably just posting to annoy other persons on this blog. We over here clearly understand our position in detail. You come here espousing what might work. You are no different from the FIE in proposing a soultion without fully understanding the problem. Speculate on the market by all means, it's your capital but do not speculate on this board...

11:58 AM

Anonymous said...

One more thing,

Let's take the discussion of Exchange versus OTC elsewhere. Each has its merits and each has its pitfalls.

Besides, like it or not, the FIE is already up and sputtering.

Let's concentrate on our issue here folks,

This blog discusses the need for third party, not affiliated with the seller, custody for securities. This one is the more serious issue because it is a proposal that does not solve anything, in fact:

1. It affects the ability of an issuer and his or her issuing agent to manage outstanding debt.

2. It encroaches on the right of a registry to properly keep detailed lists of registered owners/holders in due course

3. It disenfranchises banks of their asset management functions.

4. It interferes with the right of the investor to his or her property; a right that includes the power to designate on an unqualified basis the disposition of his or her assets post-sale.

12:14 PM

Anonymous said...