Hi Salve,

I wonder why with the low inflation, we still have high borrowing rates….Is it time for the borrowing rates to go lower? Housing Loan is still @ 9-11%. For me seems to be high for middle class Filipinos. I saw one article http://business.inquirer.net/money/personalfinance/view_article.php?article_id=58559
where the couple is asking if they should give up on their dream home. I know exactly how they feel because Home Loans should be the kind of loan where interest rates should be low.
Im still doing some research on the correlation of inflation, borrowing rates in our country, but Im trying to find hard getting historical data…

Hi, could you make an article regarding the things written in the business section of the newspapers like gdp, gnp, foreign reserves coz i have been reading newspaper for years and only now do i read the business section. Btw, i’m a fresh engineering grad so i really couldn’t relate to the terms and numbers on the business section. Thanks.

Hi TraderPinoy, bank lending rates should start falling soon. A banker told me last week there are some really good deals in the market now (and he was talking about a competitor!). When looking for home loans, you really have to shop around because this is one of the most important personal finance decision you will make in your lifetime. Tip: look for banks that already have tie ups with major developers. But mind you, I’m not talking about developers’ in-house financing schemes, which carry rather high interest rates. When I look for historical information, I always visit Bangko Sentral’s website (http://www.bsp.gov.ph) and NSCB (http://www.nscb.gov.ph). I bet you will see what you are looking for, but if you are still unsatisfied, the Bangko Sentral has an office that’s really for the hard-nosed researcher. Sorry, I cant remember right now what they call it exactly but its a library of sorts. Good luck with your research!

In my opinion, most of the people who read the business section are, on average, those who have a background in business and/or those who work as managers and are,therefore, familiar with these statistics. Inflation is one economic statistic that the average JDC should be able to understand but in reality, it is not the case (even my father doesn’t fully grasp it and he’s a lawyer!).

What I’m trying to say is, more Filipinos should be educated, or at least be more exposed, in the key economic indicators that affect individual decision making. In introductory economics modules for non-economists that are taught in universities, most students will most likely remember the principles of supply and demand and less likely remember anything about macroeconomics. So, more exposure or learning from personal inquisition or perhaps from secondary education about economics is important and is the key issue here.

Since the Bangko Sentral has followed an inflation-targeting framework (and it seems to have succeeded in keeping down and stable), the next key indicator is the nominal interest rate. But I’ll stop here since I’m not paid not do a business article anyway hehehe

We need additional years in highschool to incorporate subjects like economics, computer, vocational course and maybe call center english. If this can be done many highschool gradutes can already find decent jobs.
So far an high school diploma can not give you even a janitorial jobs…

Economics is taught is high school (third year) but I think the students do not appreciate it, at that stage of life. I’ve completely forgotten what I’ve learned in economics back in HS except the concept of supply and demand. It’s quite boring too, because it’s very theoretical.

Vocational is taught in Trade School so if one studied HS in a trade school, he probably learned one or two skills (e.g., drafting, carpentry, etc.). Don Bosco incorporates drafting (i believe other skills also) in their HS curriculum.

Computer are now taught in schools. But it depends on which school you go to.

But I agree, we need reforms in our educational system. Our curriculum should be designed such that even a HS graduate, will have competencies to find a decent job. Non-degree / vocational courses should also be promoted, especially yong pwedeng pagkakitaan agad. We need to improve the quality of education and make it comparable to other countries so we can compete globally.

college education is getting expensive too especially if you factor in daily costs like board and lodging. about 2 decades ago, present worth analysis of 5-year college course expenses and net income after graduation up to retirement is just about breakeven. i don’t know if the present situation is much better for a college graduate. this is a good exercise in economics where you make assumptions on cost of money, cashflows, inflation, etc.

Trader Pinoy,
The good thing now is that banks extended the loans upto 25years and made it fixed (9-11%). that is something that commercial banks can’t do few years before and only Pag-Ibig can offer. Also, rates now are relatively low compared before (12-18%). With fixed rates, one can manage his/her budget because of expected expenses.I think Pag-Ibig’s rate is around 6% now. this is the miracle of low inflation regime!

Pag-ibig rates:

Loanable Amount
6% P300,000 and below
7% P300,000 - P500,000
10.5% P500,000 - P1,000,000
11.5% P1,000,000 - P2M

There’s a surcharge of 2% if the loan is delayed. Here’s the website for more info. They also an on-line calculator to estimate amortizations.
http://www.pagibigfund.gov.ph/index.asp