Finance: Time Value of Money

When Jose received 200,000 pesos in full from a buyer of fruits. He was happy. Jose is the owner of an orchard and usually every year, he spent more than the amount of fruits he sold that varies from 30,000 pesos to 40,000 pesos. This is because of Climate Change, the change in temperature and weather determines the amount of fruits not to mention the calamities such as typhoon and earthquake, which is rampant in the Philippines.

Jose received 200,000 pesos for the fruits that will be harvested for each year within 5 years. This is his first time move and considering the cost of it today is different after 5 years. From the book Financial Management principles and applications, the amount of money today is worth more than a dollar received a year from now because for instance a peso today can be invested and earn interest. The economist calls an “opportunity cost” of passing up the earning potential of the peso today. The opportunity cost is the time value of money.

Compound Interest and future value is very important in realizing the significance of the value of peso today. Since Jose received 200,000 pesos today and that value on the other hand is not sure on the buyer who paid him in full because of Climate Change and the risk he took which could be favorable or not, the luck is with Jose and the opportunity cost if he will use it well will be resulting to an earnings. Say, Jose invested that money in full in a sure business, he could earn more, that is the opportunity we are talking about.

If that 200,000 pesos earns 10% every year, the compound interest will be 20,000 pesos and for the next year will be 22,000 pesos because we add the principal and the interest for the first year which became the principal on the second year or present value, and the interest we earned the first year, in effect we are now earning interest on interest, this is the concept of compound interest.

This is a discussion I have with my mother today, the “Time Value of Money” which is the money is more important today than in the future because of the “opportunity cost” and the value. This is to understand the best options if there are choices and decisions to make in terms of getting the money right now in full or wait for it every month. From this computation, I will stick to the full amount received today than a staggered payment that in five years, the risk is still there.

To make decisions, financial managers must compare the costs and benefits of alternatives that do not occur during the same period. Whether to make the profitable investments or to take advantage of favorable interest rates, financial decision-making requires an understanding of the time value of money. Managers who use the time value of money in all their financial calculations assure themselves of more logical decisions.

First Contest: Blogging for Advocacy

For Advocacy, Political, Lifestyle and Empowered Blogger. My Blog is featured every week at the CALABARZON area newspaper “Kliping Times”. Topics are about Advocacy, Politics, Lifestyle and Empowerment. For this Christmas season, I am planning to feature 5 Blogs before the end of this year. For your opinion, news and advocacy to be heard and printed, I am opening slots and opportunities for you.

I will accept articles the whole month of November that will be published and printed every week up to the end of 2011. One article per person will be published but you could send up to 5 articles to choose from.

Planning to give also additional prize for the Blogger who will be chosen, ok, still thinking about what kind of prize, so stay tuned!

Send your articles to gracenicolas@yahoo.com

Thanks.

Again, but what is Filipino?

In view with the recent attacks or crimes everywhere, I started to question again the mindset of our Filipino brothers and sisters. People are fighting because of misunderstanding. But in war, there are no winners but only casualties, children without parents or parents without children. Brothers are fighting with brothers or sisters are cursing one another. But why? Any reason for this? But what is Filipino?.

Filipinos are people from the Philippines. More than 92 Million Filipinos are living in the Philippines while 11 Million are living or working outside the country. Crimes are everywhere, whether Muslims killed Christians, Christians killed Muslims, Muslims to Muslims or Christians to Christians, It is not about Religion anymore, it’s about the character of a person and attitude towards morality, but what is morality? From the dictionary, Morality is the differentiation among intentions, decisions, and actions between those that are good (or right) and bad (or wrong). A moral code is a system of morality (for example, according to a particular philosophy, religion, culture, etc.) and a moral is any one practice or teaching within a moral code. The adjective moral is synonymous with "good" or "right." Immorality is the active opposition to morality (i.e. good or right), while amorality is variously defined as an unawareness of, indifference toward, or disbelief in any set of moral standards or principles.

But who and what is the basis of morality if people in one country have different points of view, set of standards or religion? What if the good to some religion are bad to some? Some even said that they are the only ones who will be saved in times of Armageddon. This is confusing, but our government is made of standards from diferent morality, the government is composed of different people with different moralities, they set the law and made it as the “Constitution”. In this case, everyone elected somebody who will lead us to what morality really means, here comes the President, the Senators and Congressmen. Let’s pretend that nobody disagree.

A great Filipino is one who has had the intellect and the courage to put more sense where the theologians and the politicians in cahoots together have put only nonsense making for our sick society. In the 500 years of Christianity in the Philippines , only one rare Filipino had the courage and the intellect to stand up against great odds to be a great Filipino - Jose Rizal - a truth-seeker, a scientist, and a humanist. To keep the Filipino frightened of the truth, however, Rizal was publicly executed by those in church authority - the ecclesiastical liars gifted with a free will from divinity to promote in the Philippines social insanity.---Poch Suzara.

Thanks to Carlos Celdrans’ ceiling and mirror for this “But what is Filipino” and if you haven’t been to his 1930’s “The Living Room” apartment, you might never know what I am talking about here. Carlos is an artist, tour guide, Reproductive Health advocate and the one after Rizal and Ninoy and might face a 6 years inprisonment if found guilty of violating “Offending the religious feelings” and why Ninoy? " The Filipino is worth dying for" but then killed by fellow Filipinos? well some said it was CIA's, hearsay or not, I believe that using intellect, there must be love too. Rizal, Ninoy and Carlos for the country, not for their own benefits but for others. Ridiculed by fellow Filipinos or Pinoys for making a difference, to stand alone as long as for the righteousness and for the majority.

To ridicule is easy especially if the topic is religion, but what is religion? Sometimes, one forget that they are not attacking the religion but the individual alone. As I will repeat over and over again. It's not about religion, race or gender. It’s about the character of the individual, its who you are, Atheist or Theist, both have flaws, both have points but united as one we could reach the highest impossible goal. You think it would be much better if both are fighting for a common cause? Which is for the betterment of the next generation. Stop typing and start acting, stop the fighting and start to do something because in this lifetime, theres gonna be no UTOPIA.

Nurtured by Nature: A Dream

When I had the beach house project at Batangas under Landco, my kids enjoyed the natural wonder of Calatagan and the virgin nature at it’s best. The Clubhouse at Ciudad De Calamba under Filinvest made them to enjoy the beauty of themed architectural designs. With the new developments at the South, with three big companies competing to make Santa Rosa City a nice place to live in, Nuvali under Ayala Land, Eton properties under Lucio Tan Group of Companies and Pramana Residential Park under Campos Greenfield Corporation are doing an Eco friendly subdivisions and developments at it’s maximum speed.

New Asian Tropical Designs are the showcase in these projects. Man Made Lake is located at the “Salk Late City” developments under Eton and is strategically located just after their own Eton Exit at the South Luzon Express way (SLEX) with cut of lot area from 70 square meters.

The architectural designs are from our top Filipino talents and could be seen the love for environment. Residential with patch of plants, roof with real grass and big windows to see the nature outside. Unlike any other subdivisions, these three developments have the same theme for the exterior of the house which is Asian Modern designs. Lot prices starting from 10,000 pesos, one could have their dream home build in this first class community.

The development in this city is just the proof of progress. Santa Rosa is a first class city in Laguna under Mayor Arlene Arcillias- Nazareno and the only city with these kinds of developments in Laguna. More than 3000 hectares of land has been transferred from agricultural to commercial and residential lots, proof that many people are employed for the developments.

Manufacturing Companies are located here too such as Coca Cola Bottlers Philippines, Toyota Motors Philippines and Asia Brewery among the others. Other notable developers are here too such as Manny Villar’s Crown Asia and Santa Rosa Estates. Xavier School, Miriam College and University of santo Tomas (UST) is on it’s way to give good quality education to the residents.

My kids enjoyed a lot the beauty of nature, they do fishing at Eton’s Salt Lake City’s man made lake, boating and Coi feeding at Nuvali and the trail at Pramana. It’s a dream come true for those who would like to escape the pollution from the city. The quiet place where the nature and progress collides is in these places. This is a dream that most active and busy people wants to live in.

Isdaan sa Calauan : Helping the Community

First in Laguna and located at Barangay Hanggan, Calauan is the newly opened “Isdaan” Floating Resto- Fun Park. A sister company of Barrio Fiesta and owned by the Ongpauco’s. Gigantic statues of Monkeys, Crocodiles, Fishes and Mermaids are all around with singing cooks and waiters serenading you.

Affordable prices of Filipino cuisine and nice ambiance are the catch if one will drop by here. Everything is new. Lot’s of attraction in this 3 hectares place at “Isdaan” like a boat ride for only 20 pesos. The “Tacsiapo” is where one could release his anger with the minimum purchase of 25 pesos, you could remove your anger by throwing the plate to the wall.

The floating Nipa huts are everywhere catering from 10 people to 30 each. For more like an outdoor dine in, there’s that biggest Monkey and lot’s of Coi area for you. I love the lights at night.

The area is like a themed park with heroes such as Incredible hulk, Spiderman, the former President Cory Aquino and Erap?

with Mayor George Berris of Calauan, Laguna

Why the kids would love it? Because of these toys located at all the right places.

Overall, we went here because of the birthday of my Twins, yes! The food is great specially this Inihaw sa Bilao for only 500 pesos plus with assorted sea foods. I love the pitcher of Fresh Buco Juice, In Calauan though we have many from our farm, it is much easier to buy it than to ask someone to get from the tree.

Main point is the employees. The newly opened restaurant gives work to the population of 70,000. Brgy. Hanggan main means of living is gardening, one from the 17 Barangays of this 3rd class municipality. The business gives work and could help the community to be known in the whole Philippines as the biggest Floating Restaurant in Laguna. Tara!

Isdaan sa Calauan (Floating Themed Park)
Address: Brgy. bangyas, Calauan, Laguna
Direction: From Manila, SLEX exit to Calamba. Go straight to Los Banos. from Los Banos there's a crossing for Calauan town proper,Sta Cruz and Bay, Laguna. Go straight to Sta Cruz way instead, then on the right side will be the Isdaan just 1 Km away from the crossing. Barangay Bangyas is the first Barangay at Calauan, Laguna that way.

Some more pics:

More pictures: Day Tour

Occupy Wall Street: Filipinos, What number do you represent?

Looks like the Filipinos are not talking about it. Not much in my timeline. But what is this Occupy Wall Street really means? From the groups website Occupy Wall Street is a people powered movement that began on September 17, 2011 in Liberty Square in Manhattan’s Financial District, and has spread to over 100 cities in the United States and actions in over 1,500 cities globally. #OWS is fighting back against the corrosive power of major banks and multinational corporations over the democratic process, and the role of Wall Street in creating an economic collapse that has caused the greatest recession in generations.The movement is inspired by popular uprisings in Egypt, Tunisia, Spain, Greece, Italy and the UK, and aims to expose how the richest 1% of people who are writing the rules of the global economy are imposing an agenda of neoliberalism and economic inequality that is foreclosing our future. Occupy Wall Street is leaderless resistance movement with people of many colors, genders and political persuasions. The one thing we all have in common is that We Are The 99% that will no longer tolerate the greed and corruption of the 1%. We are using the revolutionary Arab Spring tactic to achieve our ends and encourage the use of nonviolence to maximize the safety of all participants.

In the Philippines which is comprised of more than 90 Million in population and majority are poor with a lot of causes why. Here are some reasons:
According to the Asian Development Bank some reasons might be the Low Investor coming to the Philippines and Pork Barrel
On the expenditure side, the continued use of “pork barrel” spending
programs at all levels of government cripples the government’s ability to function
effectively, by putting a significant portion of these already limited resources
out of reach of those who are attempting to formulate serious plans for allocating
spending according to the right criteria.

The investment level in the Philippines has been low and falling since
the Asian financial crisis of the late 1990s (see Table 29). Increasing investment
levels hinges on an attractive investment climate, something the Philippines
has not achieved. As a result, the country suffers from limited capital formation,
limited productivity improvements and limited competitiveness of firms. The
Government has a central role to play in shaping the investment climate,
which essentially comprises the macroeconomic fundamentals, infrastructure,
and governance and institutions (such as the legal and regulatory framework).

All of these combine to influence the costs and returns of doing business.
The highly educated, English-speaking workforce of the Philippines is
considered one of the most technically proficient in Asia, but the country
faces increasing pressure from heightened global competition for market
and capital. Without improvements in the investment climate, the country will continue to lose out. – ( http://www.adb.org/documents/books/poverty-in-the-philippines/chap6.pdf)

So how would a simple “Juan and Maria” could comprehend the inequality of distribution of wealth in the Philippines? Is it through the availability of basic needs for one family such as food, clothing, shelter, clean water, medicines and education? Scientist had this concept of inequality, which they are thinking is distinct from that of poverty and fairness. From the dictionary, “Income inequality metrics or income distribution metrics are used by social scientists to measure the distribution of income, and beconomic inequality among the participants in a particular economy, such as that of a specific country or of the world in general. While different theories may try to explain how income inequality comes about, income inequality metrics simply provide a system of measurement used to determine the dispersion of incomes.”

I checked last time that poor in the Philippines has a ph 9,000.00 ($200.00) in salary monthly and rich would have ph 200,000.00 ($4,650.00. The gap is so big and with the growing population plus not to mention the corruption and economic downfall, what will happen to the rest of us?. With the new administration, will and strategy to combat this problem is necessary and a must. We are not asking for rallies but if that will be the solution, why not. We are the 99%. If the government couldn’t help us, who will?.

Banks are raising their interest for loans and even the governments bank sometimes even wanted the Filipinos to be in squatter. What is their mission and vision? Some big companies are into monopoly, they could rise the cost of the services and the Filipinos doesn’t have any choice but to work hard or else will be in dark at an instant. What happened to “Bayanihan?” Does our morals lost because of profit?.