this too shall pass...

nang mabasa ko yung post ni professor bets, aku'y napilitang (as in bold letters!) mag-post ditu para lang maipahatid ko sa inyu ang aking nalalaman, opinyon at mas higit pa...aking nararamdaman sa financial crisis ditu sa bayan ng mga kano.

pasensyahan nyu na muna ako kung paminsan-minsan ay mag-i-inglish aku. feeling ko tuluy pangmatagalang balitaktakan ang mangyayari sa reunion con payabangan natin sa disyembre (isa itu sa mga topic ha!).

bakit ko pinamagatan "this too shall pass?" yan kasi ang lagi kung sinasabi kay adrienne (sa mga de nakakaalam...asawa ko po) pag tinatanung nya aku kung kamusta na yung stocks namin? de aku makasagut ng diretso kasi magagalit sya. ako kasi ang nagpumilit sa kanya na mag-invest sa stock market. yung napag-ipunan namin sa mahigit na 2 taon ku ditung pagiging nars.

ditu sa bayan ng mga kano, ikaw mismu ang bahala sa iyung financial future (retirement, college savings, house) hindi kagaya dyan sa pinas na meron SSS at GSIS at Pag-ibig. ditu, ikaw ang magma-manage ng retirement mo. dyan sa pinas, every month may kinakaltas sa sweldo mo para i-hulug sa SSS/GSIS at sila naman ang magi-invest nung para sanyu. ditu hindi, ikakaltas lang nila ang pera sa retirement kung gustu mu, at ikaw ang mamimili ng mga companies na bibilhin(stocks) para sa retirement mo. at syempre..halos lahat gustung bilhin yung mga malalaking kumpanya (look: Dow Jones) microsoft, AIG, Citibank, General Motors, Home Depot, Walmart. natutuhan kung mabilis itu at aku'y nawili sa stocks, mutual funds at bonds investing. nakaka-addict kasing tignan yung account mo na biglang lalago kasi on the roll yung company na binilhan mo ng stocks. and then...the crisis started..actually it was in the making about a year ago. just last month i was up by 20%! tapos nagbago ang lahat.

panu baga nagsimula ang krisis ditu? dahil sa mortgage crisis. dahil sa mabilis na pagtaas na presyo sa bahay dito, marami ang gustung bumili..hindi para maging kanila, kundi para i-benta at kumita. Dahil boom years ang 1996-2006, except sa tech bubble nuung 2002-2003, marami ang may trabaho at marami ang may kayang bumili ng bahay. Tuwang-tuwa ang mga banko kasi malaki ang cut nila sa mortage loan.

The reason housing is wreaking havoc even on insurers like AIG and big investment banks, who do not make mortgage loans, is that during the boom, trillions of dollars of mortgages were packaged together into securities that promised to pay investors with the proceeds of those loan payments.

Those securities paid better rates than other types of assets during the boom years. So many investors from around the globe poured as much money as they could into those securities.
Faced with this demand, lenders starting making more loans to riskier borrowers, including people who might not be able to afford their mortgage payments in the future and even many with no proof of income.

When prices were rising, this wasn't a problem. The risk of loan foreclosure or default was limited because many homeowners were able to sell their house for more than they owed and make a profit.

But once prices topped out and began falling, loan defaults and foreclosures started shooting higher as homeowners found it more difficult to sell their house. This created problems not just for subprime borrowers but even for those with good credit and income.

When foreclosures rose, the value of the various types of securities tied to mortgages started to fall, causing huge losses up and down Wall Street. It also made banks less eager to extend credit because of the risks involved.

In just nine months, the US have gone from five big, independent Wall Street brokers to only two -- Morgan Stanley and Goldman Sachs.

The US government took over Fannie Mae and Freddie Mac, the country's largest mortgage companies, a bit more than a week ago.

And just Tuesday, the US government nationalized AIG, the world's largest insurer.

Of course, consolidation inevitably produces winners and losers. Lehman Brothers, the fourth largest US broker, is a loser. It went bankrupt three days ago.

Bank of America is a winner. It bought brokerage Merrill Lynch three days ago and is now US largest financial institution.

That's a lot of change in not a lot of time.

And when there's change, there's uncertainty. Today, for example, we still don't know whether Washington Mutual, the largest U.S. savings & loan, will stay independent.

Uncertainty isn't good for any business, as it destroys confidence. It is especially bad for the financial system, because the system runs entirely on confidence. I lend you money confident that you will pay me back. If I don't have confidence in you, I won't lend.

Which is just like Wall Street today. The financial institutions don't really trust each other. And for good reason.

ang dami kasing ganid ditu sa pera eh. marami ngang mayaman...patayan naman sa pagkuha nuun.

pero bakit ba bi-nail-out ng US government ang AIG at hindi ang Lehman Brother's? because AIG is part of the 30 biggest companies in the US (Dow Jones Industrials) pero ngayon hindi na kasi bumagsak stock price nila (pinalitan ng Kraft Foods) and they have a big impact on all of us here with retirement accounts (almost 70% of working people here in the US) kasi halos lahat nag0invest sa Dow. Even Metrobank, Banco de Oro, RCBC and PCI Bank meron stocks sa AIG! akalain mo yun! so lahat magkaka-konekta!

masakit tanggapin na halos 30% ang nawala sa account ko...pero ok lang yun (hikbi, sabay singhot) naniniwala akong tataas ulit sila (e.g. mastercard, intel, microsoft)

so hanggang ngayon...sinasabi ko pa rin sa sarili ko..."this too shall pass..."