Consumers needed a little break, what with the tense September to October months and worries about whether the sky is falling down and whether jobs will still be there next year. Thankfully, there have been a lot of good news this week and Christmas seems a lot less gloomy. Here’s your weekly roundup, to help those who feel like they have missed out on some news items this week.

Personal Finance:

Principles the crisis hasn’t changed
INQUIRER.net columnist Johnny Noe Ravalo points out that investors and savers have to understand that crises are part of life and that there is simply no way to perfectly see the future.

“Lehman was after all an AA-rated credit so who would have imagined what would become of such a venerable Wall Street name. This human limitation is the best reason why we should be saving. We should save because it is the only way we can transfer purchasing power from when we have a surplus to when we may suddenly need more of it. In other words, saving during normal times helps us manage the difficult times. When difficult times kick in, our financial plans often shift to prioritizing liquidity over profitability. Unless we have a fool-proof way of either marrying into or inheriting liquidity just at the right time, we simply cannot maximize liquidity when we have no saving to speak of in the first place.”

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If you haven’t had time to read the business papers this week, at least read the articles below so you can catch up

My recommended readings for the week still have the tang of the US financial crisis and market upheavals, but indicate that even after screams of dismay due to the crisis, life goes on. People still have to figure out the answers to the usual concerns of someone trying to go on with life like whether it is smart to invest in a memorial plan, or how much insurance is really needed.

The government and the private sector are, as always, trying to find ways together to insulate Filipinos from the crosis (or at least make it appear they care :p ). Some of the items you will find in the news portion are positives for the Philippine economy, some are not. Hope these help you make informed decisions in the coming months.
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So the US government is taking over American International Group. What now, asks one reader. Lines of clients at Philamlife branches, and similar scenes in other Asian countries have many people asking: Is my insurance policy now worthless? What happens to all the money I have paid? Should I withdraw my investments?

I asked several insurance and investments experts and found that there are only five things you need to know:

1. AIG is not directly responsible for the contract that you hold. The responsibility for that lies in the subsidiary whose contracts will have to be respected even by the Fed. It is thus perfectly possible for AIG to be taken over or even to file for bankruptcy, and your policy to be fine. Now even if Philamlife, being one of AIG’s profitable businesses, is sold, the Insurance Commission will require anybody who buys Philamlife to service claims now, or when the contract matures.

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Like dominoes, the effects from convulsions in the US financial system will begin unraveling and regulators, investors and market players are hoping there will be more pieces left standing than those that are toppled over.

Late breaking news that the Federal Reserve is now considering providing a bailout package for American International Group is providing a soothing balm to Wall Street, especially after the company was downgraded yesterday by major ratings agencies. We will know more as the day unfolds whether the “unnamed source” in Bloomberg’s report has just given markets an early Christmas gift.

Because Lehman Brothers, Merrill Lynch and AIG are all complex financial companies, the reckoning may take months, not days. AIG’s dilemma, in particular, has had everyone’s knickers in a twist because its demise will hit every big Wall Street name and is expected to have huge ramifications all over the world. Government economic managers are largely expected to talk about this issue during their mid-year economic briefing at the Shangri-la Plaza in Makati at 10 a.m. today.

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(Photo from Agence France-Presse)

The other day, I felt like crawling inside a cave and hiding for the rest of my life. Oh, for at least 10 minutes.

This news story that originated in San Francisco in the US the other day that said a basic flaw in the Internet could allow hackers to take over the web triggered all sorts of warning signals in my brain.

Major software and hardware makers worked in secret for months to create a software “patch” released on Tuesday to repair the problem, which is in the way computers are routed to web page addresses.

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