China manufacturing shrinks in January—govt

Women work at a garment factory in Huaibei in central China’s Anhui province Tuesday, Jan. 20, 2015. AP FILE PHOTO

BEIJING, China – China’s manufacturing activity contracted for the first time in more than two years in January, an official survey showed Sunday, signaling further downward pressure on the world’s second-largest economy.

The official Purchasing Managers’ Index (PMI) released by the National Bureau of Statistics (NBS) came in at 49.8 last month, down from 50.1 recorded in December.

The index, which tracks activity in factories and workshops, is considered a key indicator of the health of China’s economy, a major driver of global growth. A figure above 50 signals expansion, while anything below indicates contraction.

January’s figure was the first contraction for 27 months.

British banking giant HSBC said last month that a preliminary reading of its own PMI edged up to 49.8 in January from a final reading of 49.6 in December. It was at the break-even point of 50.0 in November.

The bank is scheduled to release its final PMI figure on Monday.

ANZ Banking Group said in a research report that the NBS figures were unexpected, particularly given “favorable seasonal factors”.

“The Chinese New Year falls into late February this year, while it was in late January last year,” ANZ said.

“Past experience suggests that there could be significant front loading effect before the Chinese New Year, which would provide short-term impetus to the manufacturing industry.”

China’s central bank surprised economists in November by cutting benchmark interest rates for the first time in more than two years, in a move interpreted as an attempt to shore up flagging growth.

The People’s Bank of China lowered its one-year rate for deposits by 25 basis points to 2.75 percent and its one-year lending rate by 40 basis points to 5.6 percent.

The Chinese economy is struggling with not just stalling factory growth, but also other problems including soft exports and the weakening property market.

It grew 7.4 percent in 2014, slower than the 7.7 percent in 2013 and the worst since the 3.8 percent recorded in 1990.

Authorities had for months used various kinds of limited stimulatory measures such as targeted cuts in bank reserve requirements — aimed at freeing up funds for lending — and a cash injection into the country’s five biggest banks for re-lending.

But top leaders say they are ready to tolerate slower expansion and will avoid aggressive measures to boost growth as the government seeks to shift the economy away from its dependence on investment and exports towards more sustainable consumer-driven growth.

Premier Li Keqiang said last month at the World Economic Forum in Davos that he was determined to bring changes that would deliver “quality growth” rather than just a high top-line figure.

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China growth down in 2014; slowest in 20 years

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New Greek gov’t blinks, vows to pay debts

The shadow of Eurogroup chairman Jeroen Dijsselbloem is cast on a wall as Greek Prime Minister Alexis Tsipras waits to greet him during their meeting in Athens, Friday, January 30, 2015. Dijsselbloem is in Athens for talks with Greece’’s new left wing government after it promised to renege on key bailout commitments required for repayment of a 240 billion euro ($270 billion) rescue package. AP

ATHENS, Greece — A day after Greece appeared on a collision course with its creditors, new radical left Prime Minister Alexis Tsipras has tamped down the rhetoric by vowing to pay off debts and not act unilaterally.

Tsipras sought to calm tensions saying his hard-left government was not seeking conflict but just needed “time to breathe”.

The Syriza-led government, which came to office last week promising to renegotiate Greece’s huge bailout, clashed with the head of the eurozone finance ministers in their first meeting on Friday.

Finance Minister Yanis Varoufakis, who had a tense meeting with Eurogroup leader Jeroen Dijsselbloem in Athens on Friday, has brought forward a trip to Paris, London and Rome to meet his counterparts.

Tsipras says he never intended to act unilaterally and expressed his certainty that Greece and the creditors will reach an agreement.

He added: “Our common interest is the economic stability and recovery for our common home, Europe.”

He also pledged to pay back Greece’s debt to the European Central Bank (ECB) and the International Monetary Fund (IMF), which, along with the European Commission, form the “troika” of Greece’s creditors.

Tsipras made the assurance as a top ECB official said the institution cannot keep lending money to Greece unless the heavily indebted nation extends its bailout program before a February deadline.

The remarks from Bank of Finland Governor Erkki Liikanen — who sits on the ECB’s governing council — come one month before the bailout program agreed upon by Greece with Europe and the IMF is set to expire.

“Greece’s program extension will expire at the end of February so some kind of solution must be found, otherwise we can’t continue lending,” Liikanen told Finnish public broadcaster Yle.

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Precious Metal ETF's Seeing Interesting Action

Since the start of January the price of Gold and Silver have risen nicely as both metals are seen as a hedge against inflation and purchasing power over time. With continued low interest rates in the U.S., the announcement of QE in the Eurozone, debt issues in Greece, and the Swiss playing games with their own currency, many investors have begun looking for safe havens.

With Gold and Silver being the most trusted safe havens by many, and gold and silver ETF's making it easy for investors to quickly get in and out of owning the metals, we are seeing some interesting actions in two ETF's that actually own bullion itself. The SPDR Gold Shares (GLD) ETF owns actual gold bullion while the iShares Silver Trust (SLV) ETF owns actual silver bullion. The fact that these ETF's own actual bullion is key because their underlying assets are based on the price the metals are trading for at any given time, not futures contracts, miners or any other way to play the metals.

As it would be expected, with what is happening around the world, these ETF's have risen substantially year-to-date; iShares Silver Trust is up 9.83% while SPDR Gold Shares has climbed 8.69%. These move come while the S&P 500 has actually lost 3.1% year-to-date.

But here is what is interesting about these moves; net flows, or the amount of cash moving in or out of these funds are wildly different. iShares Silver Trust ETF has seen $175 million flow out of the fund since January 1 while the SPDR Gold ETF has seen $1.93 billion flow into the fund, according to etf.com data. So why is this happening?

While on the surface both gold and silver are commodities and hedges against currency fluctuations and inflation, the fact of the matter is, they are both not the same. Besides being used in jewelry, gold has no other use other than as a hedge against inflation. On the other hand, silver is not only used in jewelry, but it is used in electronics and other real world applications. This means the demand for silver is higher when economic activity around the world is increasing and it is lower when growth around the world begins to slow down.

The demand for a safe haven being caused by the QE program in the Eurozone and the debt issues in Greece also highlight the fact that economic activity in Europe is not great. On top of the weakness in Europe, our economic activity even here in the U.S. is still on slippery ground and probably the biggest wild card in all is China, which recently reported GDP at its slowest growth rate since 1990.

Over the past six months commodities nearly across the board have fallen as Chinese demand has slowed. Iron ore, coal, copper, and oil are all well off their highs as China's sensational demand for raw materials has slowed recently. Over the past three decades China's GDP growth has averaged 10%, but with 2014 GDP coming in at 7.4% and economist expecting 2015 to hit 6.8% and 2016 to fall in around 6.5%, it is unlikely the price of commodities are going to get a boost from China anytime soon.

Investors simply looking for a safe haven need to understand that gold and silver, while similar in a lot of ways, have different factors affecting their prices. Gold is a truer safe haven against inflation, while silver will likely give you a better return if world economies are improving but inflation is still a concern.

Matt Thalman

INO.com Contributor - ETFs

Disclosure: This contributor has no positions in any stocks mentioned in this article at the time it was published. This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.

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Village finds a ‘brother’ in Malaysian billionaire

CAGAYAN DE ORO CITY—For some 100 urban poor families here, life after Tropical Storm “Sendong” begins at the end of an uphill road that snakes past the city public cemetery in Sitio Bolonsiri in Barangay Camaman-an—the same cemetery where 250 unidentified victims of the storm lie in a mass grave—into a community housing project built through the kindness of a foreigner.

Thirty-six year old Romelyn Datahan said she used to think there would be no end to the cycle of sleeping on cold concrete floors in covered courts crammed with evacuees like her, each time rain causes the Cagayan River to breach its banks as it did in December 2011, killing over 1,500 people in riverside communities all over the city.

During heavy downpour, Datahan said she, husband Julius, and their six children would frantically gather their belongings and flee to safer grounds, leaving their home at the mercy of rampaging floodwaters.

“Not anymore,” Datahan said as she sat with neighbors outside a row of gaily painted homes in Berjaya-Gawad Kalinga village in Barangay Camaman-an. They were waiting to meet the benefactor who helped change their lives.

Like the other homeowners, Datahan wore a white shirt with the words “Thank You” in bold, black letters.

Those were for Malaysian Tan Sri Dato Seri Vincent Tan, founder of the Berjaya Group of Companies.

Berjaya is one of Malaysia’s largest conglomerates with business interests in various key industries around the world.

In the Philippines, the Berjaya Group has been in business for 18 years, holding majority control in several businesses such as Papa John’s Pizza, LoadCentral, Friendster Philippines, Berjaya Hotel, and Berjaya Auto Philippines, the Philippine distributor of Mazda.

Tan, one of the 10 richest men in Malaysia, flew to this city recently to witness the turnover of a road concreting and drainage project by the government in a village he helped build together with Gawad Kalinga.

Speaking to residents later in the day, Tan said he was in London when he saw newsreels of the aftermath of Sendong.

Moved by the suffering, Tan said he immediately called Berjaya Philippines country head Paul Soo to see what can be done.

That phone call eventually led to a partnership with GK that was formalized during the GK Bayanihan Expo held at the SMX Arena in October 2012.

Tan personally handed over a check worth P100 million to GK founder and chair Tony Meloto.

The P100 million was the first installment of a total donation of P300 million. Berjaya also donated P1.1 million to the relief efforts for the victims of the 2013 Bohol earthquake and the victims of Supertyphoon “Yolanda.”

“It is important that when we invest in a country, we must be a good corporate citizen,” Tan said, explaining his philosophy.

“We just don’t come, do business, make money, send back dividends. We must invest in the country,” Tan added.

“We must create jobs and we must help the less fortunate and victims of natural disasters,” he said.

From the seeds planted in 2012, a successful partnership between Berjaya and GK has emerged to benefit close to a thousand families across the country, mostly in areas devastated by natural calamities.

To date, Berjaya and GK have sponsored homes in the following areas: Cagayan de Oro (200 units); Compostela Valley (100 units); Lantawan, Basilan (30 units); Trece Martires, Cavite (30 units); Los Amigos, Davao City (30 units); Kitcharao, Agusan del Norte (30 units); Mobo, Masbate (30 units); Malitbog, Southern Leyte (30 units); Sapad, Lanao del Norte (30 units); Sumilao, Bukidnon (30 units); Esperanza, Sultan Kudarat (30 units); Del Carmen, Surigao del Norte (30 units); Cagayan de Oro-Escriva (100 units); San Jose Del Monte, Bulacan (100 units) and Bohol (100 units).

Tan said Berjaya was looking at building more houses with GK in Yolanda-devastated areas in Central Visayas.

Tan said he was drawn to building shelters as decent homes help build dignity in the people that come to own them. Freeing the less fortunate from the expenses of building decent homes also allows them greater economic participation.

Commenting on Berjaya’s corporate social responsibility initiatives, Barjaya country head Paul Soo said he was elated by how significant the housing projects in Cagayan de Oro had been changing the lives and uplifting the community spirit of the families.

“Given the challenges of poverty and natural disasters that still and will confront us in the future, we remain true to our original mission and purpose, that is to step up our role in making major contributions to help build a more self-sustaining and inclusive Philippine community,” Soo said.

Speaking on behalf of Gawad Kalinga, GK executive director Jose Luis Oquinena said Berjaya’s support had enabled GK to help empower the poorest of the poor in the country.

“We are thankful to the Berjaya Group for sharing and realizing our mutual vision to alleviate poverty,” Oquinena said.

For Datahan, Tan is no longer a stranger to her family and the rest of the residents of the village.

“Like a brother,” Datahan said of the Malaysian.

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PH pastry chefs wow judges in France

REALIZING a dream begins with a vision, followed by setting goals, then working hard everyday, no matter the obstacles, towards reaching those goals and achieving that dream. This is true for any enterprise. And it was true for the Pastry Alliance of the Philippines.

Chefs Buddy Trinidad and James Antolin joined the Asian Pastry Cup 10 years ago and said, “Within 10 years, we will field a team to the World Pastry Cup.” And they did.

Dream realized

Ten years might seem like a long time but it was a realistic timeframe for the goal because it is not easy to qualify for the Coupe du Monde de la Patisserie (World Pastry Cup).

For one, it is the biggest gathering and most prestigious competition of pastry chefs around the world, described by its founder Gabriel Paillasson as “the Formula 1 for pastries.” Case in point: at the 2015 Coupe du Monde de la Patisserie, only 21 countries qualified to compete. Australia, which has some of the best chefs and restaurants in the world, did not even compete this year.

More notably, even the world’s greatest chefs have a hard time getting the gold.

At the Bocuse d’Or, a parallel competition of chefs from around the world, which was the finale of the Sirha Summit, the American team this year won the silver medal but it was the first year that the Americans placed higher than sixth in the international competition.

And they only got up to silver even if the team was led by such established chefs as Thomas Keller, Daniel Boulud and Gavin Kaysen.

Best ice sculpture

So it was with great pride that the Philippines waved its flag among the 2,500-strong audience of the Coupe du Monde de la Patisserie held last Jan. 25 to 26.

But even better, on their first try, the Philippines brought home the special award for best ice sculpture.

The carving skills of chef Vicente Cahatol impressed the judges so much they had to give him credit.

The ice sculpture was of a little boy hunter carrying a deer. “What is amazing about it is that he sculpted this from memory,” chef Peachy Juban, one of the coaches of the team, noted. “The other candidates were using measurements but Vic just sculpted away.”

The prowess of Cahatol in sculpting was displayed not only in the ice sculpture competition but also in the new category of chocolate sculptures.

Valrhona provided blocks of chocolate weighing 10 kilos each for the competition and each team had to sculpt this block.

In this round, chef Miko Aspiras, another one of the coaches, noted, “Other teams chopped up the chocolate, made parts of the block the square surface for their sculptures but Vic did not break up the block at all.”

Cahatol created a chocolate sculpture of the Philippine bayawak.

It was so unique and creative, with such exquisite detail, that while the Philippines did not win the special award for this category, it did get a special mention from the Valrhona representative and the bayawak was a favorite photo of the international media, making it to various French newspapers.

Good ranking

On top of this special award, the Pastry Alliance of the Philippines, which essentially was the Philippine delegation to the competition, was proud to announce that the Philippines ranked 12th out of the 21 countries.

Vice Consul Rapunzel Acop, of the Philippine Embassy in France, who supported the Philippine team and joined them in Lyon, observed, “It’s incredible for a first-time competitor. We beat all the Latin American countries, the entire Arab world and even China.” Argentina, Mexico and Colombia ranked 13 to 15 (in that order) while China trailed at 17.

Note, too, that no Southeast Asian country has ever won a gold medal in the competition. So that is the next goal of the Pastry Alliance of the Philippines: to bring home the gold in 2017.

Philippine Pastry Alliance

The other two chefs who competed on behalf of the Pastry Alliance of the Philippines were Rizalino Mañas Jr., who created the entry for the chocolate showpiece; and Bryan Dimayuga, who was responsible for the sugar showpiece.

They were required to create a chocolate showpiece, a sugar showpiece, one carving piece, a chocolate cake, a plated dessert and a chocolate block carving within a period of only 10 hours. But way before that, the team, with the coaches, already conceptualized the creations under the competition’s “Life Cycle” theme. The results were creations with a unified theme of “hunters and the hunted” entitled “Siklo.” Mañas created a beautiful Filipina hunter out of chocolate, while Dimayuga created a stunning sugar showpiece of the Philippine spotted deer. These creations were amazing beyond words.

Credit goes as well to team president Buddy Trinidad and vice president James Antolin, as well as senior pastry chefs Peachy Juban, Dan Basilio, Jackie Ang Po, Miko Aspiras and pastry artist extraordinaire Penk Ching, who were all present in Lyon to guide and support the three chef-contestants. I was also surprised to find Filipinos like chef Dennis Hipolito in the audience, who flew all the way from Singapore on his own, just to support the team. “This is the first time that the Philippines competed. This is history,” he said, explaining why he could not miss the event.

Props must be given to the Pastry Alliance of the Philippines, who fielded this team without government support, raising funds and spending their own money for practice sessions, as well as airfare to and lodging in Lyon, France—all in the name of bringing pride to our country in this field.

Sirha 2015

The pastry competition was not the only event at the Sirha World Hospitality and Food Service Summit. The finale was the Bocuse d’Or, the most prestigious competition of chefs the world over, won this year by Norway (silver went to the US and bronze to Sweden). I heard that the Philippines last year through Le Toque Blanche tried to field a Philippine team but lost to Singapore. Hopefully, we will be able to wave the Philippine flag as well for Bocuse d’Or in 2017.

But Sirha was not just about competitions but more importantly, the four days of the expo is all about trade. The Eurexpo of Lyon, France was filled with over 2,000 exhibitors, a few product launches and the World Cuisine Summit, where the most pressing culinary issues of the day were discussed.

At the last Sirha, there were over 185,500 professionals on the lookout for new trends including almost 25,000 visitors from 138 countries. It is truly the largest gathering of food service and hospitality professionals from all over the world to note the latest trends and innovations.

In a few days, the Philippines will launch Madrid Fusion Manila in Spain. Watch out for the details next Sunday. Who knows, if we are successful at Madrid Fusion Manila, France might look to us as well to host Sirha for Asia.

Congratulations once again to the Pastry Alliance of the Philippines. You make our country proud.

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Sterling Momentum Softens

In our last review on the Pound Sterling, we noted that the currency had been weak amid a soft patch in the UK economy. The pace of GDP Growth was slowing and unemployment was no longer falling, yet the robust retail sales figure had provided a bright spot for Sterling bulls. While growth momentum has continued to slow, it has remained fair, and with massive easing coming from across the Channel, i.e. the ECB’s QE program, Sterling was able to gain ground vs its European peer. Yet, with the BoE meeting looming next week, and the release of the February inflation report and Mark Carney’s follow speech, there is growing speculation that the BoE may open the door for a possible retreat, or perhaps even a U-Turn, in its plans for rate hikes. What is that speculation based on and how could it impact the Pound Sterling?

Inflation Evaporates

It is true that this is not a new phenomenon in the UK, nor elsewhere in the world for that matter, but as the chart below illustrates, while the Bank of England maintains a rather elevated level of expectations of potential rate hikes, UK inflation continues to be dragged downwards and is moving closer toward the disinflation levels seen in the Eurozone. Yet, even as these developments begin to take form, the ECB is in the midst of massive easing while the BoE is on the path to do the exact opposite. Investors, from their point of view, considering just how the Eurozone and the UK are so closely integrated, have thrown up a great big question mark on the proceedings.

The Threat to Jobs

There is yet another side to the decoupling rate path that investors believe should change the BoE’s direction. As Sterling moves higher against the Euro, exports to the Eurozone, which is the largest destination for the UK, have become more and more stagnant and this has had a negative effect on one of the most important indicators in the UK economy, namely jobs. As seen in the chart, the claimant count rate, which has been steadily falling and thus helped to lower UK unemployment, is losing momentum which suggests that a rate hike would lead to further Sterling strength vs the Euro and could eventually take unemployment levels even higher.

Uneven Growth

Of course, for quite some time, investors have been cognizant of those two key factors against a rate hike, yet the latest GDP results have revealed one other reason to downplay the possibility of a rate hike by the BoE. The GDP growth release from the ONS, while revealing a fair growth rate of 2.6% YoY, has also demonstrated how growth in the UK is uneven; Agriculture and Production was unchanged over the quarter, “growing” at a virtual standstill, while the Construction sector shrank. The only contributor to growth over the period was from the Services sector. Taken together, that further suggests the potential of more soft patches in the UK economy further along the road.

The Bright Spots

Fortunately, the UK economy is not comprised only of soft spots; there are areas of strength, as well. For example, growth, despite its unevenness, is closer to 3% than to 2%. The Services sector, which components range from banking to law, is showing surprising resilience to the weakness in Europe and continues to grow steadily over time, with PMI data suggesting that it will continue to do so. Moreover, Retail Sales, despite a seasonal slowing, are still growing at a robust pace of 4.3% and Consumer Confidence is consistently rising, suggesting that UK consumers expect their overall situation to improve and are thus ready to spend more. Despite UK inflation sliding alongside the Eurozone’s, in most parameters the UK vastly outperforms the Eurozone. And last but not least, it would be remiss not to mention the boom in UK housing prices.

February to Tilt Sterling Lower?

If figures and data would have been concrete proof that the BoE will have to reverse its course on rate hikes, then investors would have already moved forward with big bets on a Sterling reversal vs the Euro and a further plunge vs the US Dollar. Although the BoE rate decision statement next week might surprise with a dovish tone most expectations hang on February’s inflation report and the subsequent speech given by BoE Governor Mark Carney. If the Governor continues to maintain an overall upbeat bias and the inflation report deems the slip in inflation as nothing but a temporary bump it might ease speculation, at least for a while. But if Carney reverses course and the inflation report reveals prolonged disinflation, then the once strong currency could quickly turn soft.

Look for my post next week.

Best,

Lior Alkalay

INO.com Contributor - Forex

Disclosure: This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.

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Weekly Futures Recap With Mike Seery

We've asked Michael Seery of SEERYFUTURES.COM to give our INO readers a weekly recap of the Futures market. He has been Senior Analyst for close to 15 years and has extensive knowledge of all of the commodity and option markets.

Michael frequently appears on multiple business networks including Bloomberg news, Fox Business, CNBC Worldwide, CNN Business, and Bloomberg TV. He is also a guest on First Business, which is a national and internationally syndicated business show.

Gold Futures

Gold futures in the April contract are currently trading at 1,277 up around $21 an ounce with extreme volatility after selling off more than $30 in Thursday’s trade while settling last Friday at 1,293 going out this Friday afternoon around 1,276 finishing down $17 in a wild trading week. Gold futures topped out slightly above $1,300 as profit taking ensued as prices are still trading above their 20 and 100 day moving average and I’m still recommending a bullish position and if you took that original trade place your stop loss below the 10 day low which now yesterday’s low at 1,252 risking around $24 from today’s price levels or $2,400 risk per contract plus slippage and commission. As I’ve talked about in many previous blogs I do think gold is now being used as a currency due to the fact that the Euro currency and many foreign currencies are absolutely falling out of bed as interest rates in many countries have gone negative so who wants to place money into a bank and lose money as investors now prefer gold which has no dividend but still it’s better than a negative return. Volatility in many of the commodity markets is very high at the current time especially the precious metals and I expect that to continue despite the fact that the U.S dollar hit an 11 year high continuing its secular bull market in my opinion as I do think 100 is on its way in the next several months as the United States economy is doing much better than any economy worldwide. Gold futures have rallied from a contract low of 1,130 all the way up to about 1,310 in the last several months as money is finally starting to come out of the S&P 500 sending money flows back into the precious metals also sending high volatility which I think is here to stay especially with all of the worldwide problems

TREND: HIGHER

CHART STRUCTURE: SOLID

Silver Futures

Silver futures in the March contract are up $.50 this Friday afternoon in New York currently trading at 17.30 an ounce settling last Friday at 18.30 finishing down about $1.00 for the trading week with extreme volatility as Thursday’s trade pushed silver lower by over a $1.25 as I’ve been recommending a bullish position in this market when prices broke above the 17 level and if you took that trade continue to place your stop loss below yesterday’s low around 16.71 still risking around $.60 from today’s price levels. Silver volatility is extremely high at the current time so make sure that you use the proper amount of contracts risking only 2% of your account balance as I like to trade the mini contract which is $10 a cent versus $50 a cent on the large contract as high volatility has also entered the S&P 500 and the currency markets in recent weeks. The stop loss will remain at that level for the next 8 trading sessions so you’re going to have to be patient if you are long this market. As I talked about in previous blogs I believe silver is now being used as a currency due to the fact that interest rates around the world are so low that investors are looking at silver and gold as a currency replacing traditional paper currencies as nobody wants to own anything in Europe. Many of the commodity markets continue to head lower however silver and gold are the only 2 commodities that I am bullish but the problem here is if the rest of the markets continue to head lower silver and gold gains could be limited so just place the proper stop loss and if we are stopped out look at another market that is starting to begin another trend.

TREND: HIGHER

CHART STRUCTURE: SOLID

Crude Oil Futures

Crude oil futures in the March contract were up $3 a barrel having one of its best days in months trading at 47.50 a barrel and trading above its 20 day moving average for the 1st time in months while still below its 100 day moving average and looks like a possible bottom could be in place. If you’re still short this market I strongly suggest you place stop loss at the 10 day high which currently stands at 49.20 risking $1.80 from today’s price levels. Crude oil futures settled last Friday at 45.59 currently trading at 47.50 up about $2 as prices actually hit new lows in yesterday’s trade as there are rumors about the new Saudi Arabian King stirring up some controversy possibly cutting production, however I truly believe that we just saw massive short covering but stick to the rules and keep your stop at the proper level and if you are stopped out move on and look at another market that is trending. All markets come to an end that’s just the fact as I’ve seen many people reenter the market several times after having a successful run only to give back all their profits so if you are stopped out move on as there are many other markets to look at the current time as this was one of the best trends in recent memory but sometimes the best thing to do is to do nothing.

TREND: LOWER

CHART STRUCTURE: EXCELLENT

Wheat Futures

Wheat futures in the March contract are down $.05 this Friday afternoon trading around $5.03 a bushel after settling last Friday at 5.30 down about $.27 for the trading week still trading below their 20 and 100 day moving average as I’ve been recommending a short position in wheat for quite some time and if you took that trade place your stop loss above the 10 day high which currently stands at 5.45 a bushel risking around $.42 or $2,100 per contract plus slippage and commission. The next level of support is the contract low of around 4.80 as I think that could be retested next week as growing conditions are excellent throughout much of the Great Plains as ample supplies should come during harvest sending prices even lower as the grain market in general look bearish at the current time as the trend is your friend in the commodity markets and the trend in this market is clearly to the downside as prices have fallen quickly as concerns about Russia cutting exports has waned at the current time as there is very little bullish fundamental news to support prices except for the fact at the current time prices are oversold but if you have not participated in this market sit on the sidelines and look for a market that is beginning to trend.

TREND: LOWER

CHART STRUCTURE: IMPROVING

Orange Juice Futures

Orange juice futures in the March contract were sharply higher this Friday afternoon in New York finishing up 555 points to settle at 140.00 as I’ve been recommending a short position from around the 137 level as prices rallied sharply due to oversold conditions in my opinion. Orange juice prices are still trading below their 20 and 100 day moving average hitting a 9 week low in yesterday’s trade selling off sharply in the prior 4 trading sessions as I think today was a kickback due to oversold conditions as the frost possibility in the state of Florida are starting to fade as the commodity markets in general still remain pessimistic, despite the fact that crude oil prices are up $3 a barrel as a possible bottom may have been created in the short term in the energy sector. As a commodity trader I am a trend follower and the trend in orange juice despite today’s sharply higher move is to the downside but make sure you place your stop loss above 148 risking around 800 points or $1,200 per contract from today’s price levels plus slippage and commission as the chart structure will not improve until at late next week.

TREND: LOWER

CHART STRUCTURE: POOR

Oat Futures

Oat futures in the March contract are down another $.08 this Friday afternoon in Chicago still trading far below their 20 and 100 day moving average settling last Friday at $2.90 finishing the week down about $.16 at 2.74 as I have been recommending a bearish position when prices broke $3 a bushel and if you took that original trade place your stop loss above the 10 day high which currently stands at $2.96 still risking about $.22 or $1,100 per contract plus slippage and commission. Oat futures have hit a fresh 2 ½ year low and the reason I was recommending this trade if you remember was due to the fact that the original risk was only about $400 which meets criteria in my opinion as prices continue their bearish trend and who knows where the low is in the oat market but continue to play this to the downside taking advantage of any rally while maintaining the proper stop loss and the proper amount of contracts. The grain market as a whole has been heading south here in recent weeks as the next major level of support in the oat market is around $2.50 and I do believe prices could head down to that level here in the next several weeks as I remain bearish.

TREND: LOWER

CHART STRUCTURE: SOLID

Corn Futures

Corn futures in the March contract are trading lower for the 5th consecutive trading session after settling last Friday in Chicago at 3.87 currently trading at 3.70 down about $.17 for the trading week and still trading below its 20 and 100 day moving average telling you that the trend is to the downside as I’ve been recommending a short position in corn for quite some time and if you took that original trade place your stop above the 10 day high which currently stands at 3.93 as corn prices hit a 3 month low with the next level of support around 3.60 as I still think there’s a possibility that the contract low around 3.30 in the next several months will be retested. The commodity markets in general still look very weak in my opinion as the U.S dollar is hitting an 11 year high once again as that’s also a negative influence on grain prices as harvest is underway in South America as traders are keeping an eye on the next USDA crop report which comes out in 2 weeks as estimates for planting is around 88 million acres which is reduction of 3 million acres from 2014. The corn markets in my opinion fundamentally speaking is not as bearish as the soybeans as less acres and expanding herds which will create more demand for corn, however if we produce between 13.5 – 14 billion bushels in 2015 I think prices could head much lower so I’m still recommending farmers to have a hedging strategy in place as deflation has been a real concern worldwide.

TREND: LOWER

CHART STRUCTURE: SOLID

If you are looking for a futures broker feel free to contact Michael Seery at 800-615-7649 and he will be more than happy to help you with your trading or visit www.seeryfutures.com

Soybeans Futures

Soybean futures in the March contract are down $.7 in Chicago this afternoon currently trading at 9.61 a bushel trading lower for the 4th consecutive trading session still trading far below its 20 and 100 day moving average as I’ve been recommending a short position in soybeans and if you took that original trade the 10 day high has been lowered to 9.96 risking around $.35 or $1,800 per contract plus slippage and commission. Soybean prices are at levels we have not seen since mid-October as I do think there’s a high probability that we will retest the contract low of 9.20 as soybean oil prices have absolutely plummeted in recent weeks hitting a contract low on 4 consecutive trading sessions as outstanding weather in Brazil and the rest of South America continue to pressure prices here in the short term as harvest will be in full swing come next week. Export estimates came out yesterday & were very good however the trend is your friend and the trend clearly is to the downside in the grain market and many of the commodity markets as the U.S dollar is hitting an 11 year high once again so continue to play this to the downside as I remain bearish. Estimates of next year’s crop are around 86 million acres and that could produce a crop around 4.5 billion bushels which could send carryover levels to historical highs so at the current time there is very little bullish fundamental news in the grain market especially the soybean complex.

TREND: LOWER

CHART STRUCTURE: SOLID

Cotton Futures

Cotton futures in the March contract are down 10 points this Friday afternoon in New York currently trading at 59.40 after settling last Friday at 57.30 up around 200 points on strong exports as I’ve been recommending a short position in this market and if you took that trade place your stop above the 10 day high which currently stands at 60.30 risking around 90 points or $450 per contract plus slippage and commission as the chart structure is outstanding at the current time. If you did not take the original recommendation I’m still recommending it at this time as the risk/reward is highly in your favor as cotton is a very large contract so play this to the downside as prices are still trading below their 20 & 100 day moving average as poor economies around the world are continuing to pressure prices as volatility has slowed down considerably over the last several weeks allowing excellent charge structure to occur. If you have been reading any of my previous blogs I am bearish the entire commodity market except for gold and silver as I do think worldwide deflation is going to be a problem as China still has huge supplies of cotton so demand in my opinion will start to weaken in the next couple of months but I like the situation at the current time so I’m recommending a short position at today’s price levels placing the proper stop loss risking 2% of your account balance or less on any given trade.

TREND: LOWER

CHART STRUCTURE: EXCELLENT

Coffee Futures

Coffee futures in the March contract finished up 190 points this Friday afternoon currently trading at 162 a pound still right near 1 year lows and if prices break under 159 I will be recommending a short position while placing your stop loss above the 10 day high which stands at 172.50 in Monday’s trade as the chart structure is starting to improve as the weather in Brazil is not as much of a concern as ideal conditions are still persisting in many key coffee growing regions. Coffee futures are trading below their 20 and 100 day moving average settling last Friday at 162.45 basically unchanged for the trading week as many the commodity markets continue to move lower as the U.S dollar is hitting an 11 year high once again as it doesn’t look like a back-to-back drought situation will occur in Brazil this year at least at the current time. The chart structure will start to improve later next week as the risk currently is 1200 points or $4,500 per contract plus slippage and commission as coffee is a very large contract controlling 37,500 pounds in one contract as the trend still remains bearish in my opinion so keep a close eye on the 159 level as a possible bear market could be underway.

TREND: LOWER

CHART STRUCTURE: IMPROVING

When Do You Enter A Trade?

What are your rules to initiate a trade on the long or short side of the commodity market? I have been asked this question many times throughout my career and my opinion is simply to buy on a 20-25 day high breakout in price on a closing basis only or sell on a 20-25 day low breakout to the downside also on a closing basis. Many times the price will break the 25 day high and sell off later in the day only to have your trade be negative very quickly.

I would rather buy the commodity at a higher price on the close because that gives me more confidence that the market has truly broken out. However there are more ways to skin a cat and this is not the only answer because some other trading systems might rely on different breakout rules that have also been reliable.

Remember always keeping a 1%-2% risk loss on any given trade therefore minimizing risks because the entry system I use always goes with the trend because I have learned over the course of time the trend is truly your friend in the long run. I also look for tight chart structure meaning a tight trading range over a period of time with relatively low volatility. I try to stay away from a crazy market that hit a 25 day high in 2 trading sessions versus the 25 high that actually took 25 days to create.

If you are looking for a futures broker feel free to contact Michael Seery at 800-615-7649 and he will be more than happy to help you with your trading or visit www.seeryfutures.com

SEERY FUTURES ACCEPTS CANADIAN COMMODITY ACCOUNTS

There is a substantial risk of loss in futures, futures option and forex trading. Furthermore, Seery Futures is not responsible for the accuracy of the information contained on linked sites. Trading futures and options is Not appropriate for every investor. My opinion in this blog are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any futures or option contracts.

Michael Seery, President

Seery Futures

http://ift.tt/1fGCqDc

Twitter–@seeryfutures

Phone #: (800) 615-7649

mseery@seeryfutures.com

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1M jobs created in 2014, but quality of jobs below par

MANILA, Philippines—Amid sustained economic growth, over a million jobs were created in the country last year, although the quality of new employment remained below par as mostly temporary positions were made available, according to the Philippine Statistics Authority (PSA).

In its Labstat Updates report released on Friday, the PSA noted that the preliminary 2014 employment data it generated showed “mixed results.”

“On the positive note, the employment level grew by 2.8 percent compared to a year ago—a net gain or employment generation that exceeded one million,” the PSA said.

The number of employed Filipinos rose to 37.3 million in 2014 from 36.3 million in 2013, preliminary PSA data showed.

Last year, 962,000 people joined the workforce, bringing the total to 40.1 million or two-thirds of the population, data showed. Hence, the number of new jobs which reached at least one million slightly outpaced the number of new entrants to the labor force, it noted.

In 2014, jobs in the industry sector, which includes construction and manufacturing, grew 4.1 percent; 3.1-percent growth was posted in services; and 1.7 percent in agriculture, a recovery from the slump in 2013, as the country was stricken by “less destructive” typhoons last year.

Also, “both the rates of unemployment and underemployment eased slightly” in 2014 compared with the previous year, according to the PSA. The underemployment rate marginally improved to 18.4 percent in 2014 from 19 percent in 2013, while the unemployment rate slid to 6.8 percent last year—the lowest since 2006, PSA data showed.

However, the PSA pointed out that “[a]mid the expansion, the quality of employment remained a key challenge,” as mostly “vulnerable” jobs increased.

“Employment growth [in 2014] was largely driven by the rise in part-time employment (9.1 percent) alongside the increase in the number of self-employed persons and unpaid family workers,” the PSA noted.

Over 1.1-million Filipinos were employed only part-time in 2014, data showed.

As such, the average hours of work went down 2.4 percent last year, which the PSA said reflected the “slowdown” in the gross domestic product (GDP) in 2014.

Last Thursday, the National Economic and Development Authority reported that the GDP grew by 6.1 percent last year, slower than the 7.2 percent posted in 2013.

The 2014 GDP growth was below the government’s target of 6.5-7.5 percent.

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Shocking News From Amazon And Google

After the bell yesterday, Amazon.com Inc. (NASDAQ:AMZN) announced, to the surprise of many, that they made a profit. That, of course, is good news if you were long their stock. The Trade Triangle technology got this one wrong, but also got it right as well, let me explain.

Prior to Amazon's earnings announcement, the Trade Triangles were on the sidelines having received a signal to cover any short positions on January 23rd at $314.75. While the Trade Triangles missed the big 10% up-move in after-hours trading yesterday, it certainly did not cause any harm either. Not getting caught wrong-footed in the market is an important element to successful investing. Or to use Warren Buffett's number one investment rule: #1. Do not lose money. His second investment rule is: #2 Do not forget rule number one.

Jeff Bezos, the chief honcho at Amazon and its driving force, decided to hold back on some some of his expansion spending and give investors something to smile about while placating the street, which was beginning to think that Amazon would never make money.

I don't think it's any secret, but Amazon wants to be everything to everybody. It wants to be the go-to place where we buy things, and they think they're succeeding. I know that they have me as a loyal customer.

Watch Amazon closely today as a move over $341.30 will ignite a major Trade Triangle buy signal that will indicate a reverse of the downward trend and a possible move up to the $395 area.

On the other side of the coin, Google Inc. (NASDAQ:GOOG) disappointed investors with disappointing earnings. The Trade Triangles have been on the sidelines and see no clear-cut pattern in this stock at the moment.

Time to buy gold again? I think so, gold (FOREX:XAUUSDO) has now fallen back to its RSI 50 line indicating it should find good support at current levels. If you want to be conservative on this trade, you may want to give it a few more days to consolidate its recent pullback and wait for a daily green Trade Triangle to kick in. I think that gold will once again resume its upward trend and move to my target zone of $1340 an ounce.

In today's video, I will be looking at Amazon, gold and a host of other markets. I'll also be looking for "52-week high on a Friday" trades for some weekend trading opportunities.

Hope you all have a great weekend. I’ll be back on Monday with more trading ideas to help you improve your trading and profits.

Every success with MarketClub,

Adam Hewison

President, INO.com

Co-Creator, MarketClub

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Lobby group urges more PH-US trade links

THE US-PHILIPPINES Society, a nonprofit organization dedicated to raising the Philippines’ profile in the United States, wants more American firms to tap the lucrative trade and investment opportunities in the domestic market and take advantage of the stellar performance of the local economy.

In a briefing yesterday, former US ambassador to the Philippines John D. Negroponte noted that the country is a logical partner for the US as it has a natural advantage given the historical ties between the two economies.

That advantage is being boosted by the fact that some major American firms have been in the Philippines for 80 to 100 years, providing a “very deep” base of experience from which new investors can draw strategic insights.

Add to that also is the fact that the Philippines has a strategic geographical location in the region; is a largely English speaking nation; and boasts of a highly educated workforce, Negroponte said.

This is why the USPS, Negroponte added, has committed to make more efforts along the lines of bringing back home a better awareness of opportunities in the Philippines, particularly in the sectors of energy, services, mining, tourism, real estate, infrastructure and even technology.

“The progress of the Philippines has been very impressive, and we expect that positive trend to continue. It is, thus, important for us to help strengthen that message of positive developments and the opportunities that these represent for US firms. After difficult times, it’s time to look at the good news. A [2014 GDP growth of] 6.1 percent is impressive,” Negroponte said.

John Maisto, who served as a director of Philippine affairs in the 1980s, noted that the Philippines has a strong edge when it comes to technology “because of the number of Filipinos, with an average age of 23 years, able to deal in this new system of communication in doing work.”

“We look at all things as we try to highlight the opportunities that the Philippines has to offer. It’s not just the geographical location but also the educational levels of attainment. These are the positive things we want to be build upon to make the Philippines more competitive,” Maisto said.

“What we’ve also seen here is the interest of the government to implement smart policies to attract more foreign direct investments and provide the right atmosphere.”

Maisto however stressed that while huge opportunities abound, the Philippine government has an “obligation to push forward and take advantage of these opportunities. Investments have to be seduced, attracted and that’s the challenge of Philippines being in a dynamic region as Asia.”

Disclaimer: The comments uploaded on this site do not necessarily represent or reflect the views of management and owner of INQUIRER.net. We reserve the right to exclude comments that we deem to be inconsistent with our editorial standards.

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MNTC bags deal to run SCTEx

THE BASES Conversion and Development Authority is set to award to the Manila North Tollways Corp. (MNTC) the contract for the management, operation and maintenance of the 94-kilometer Subic-Clark-Tarlac Expressway (SCTEx).

This was after the agency yesterday failed to secure bids from other companies, challenging the offer previously made by MNTC, the BCDA explained in a statement issued Friday.

Under the terms of reference for the price challenge, the agreement will be awarded to MNTC if the government does not receive any counter offer.

“We have observed all the transparency required for this deal and worked hard to preserve the integrity of the process. We are happy to move on and close this deal, proceed to working for the improvement of the service in SCTEx, and serve the public interest,” said Arnel Paciano D. Casanova, BCDA president and chief executive officer. “This just proves that the latest improved offer of MNTC is the best in the market.”

It was in December last year that the BCDA board approved and released the guidelines for the SCTEx price challenge, allowing the bidding for the long-term contract to operate and maintain the toll road.

Interested parties had been required to submit a price higher than the P3.5-billion upfront cash offer—on top of the 50-50 sharing of gross revenue—from MNTC, a firm led by businessman Manuel V. Pangilinan. MNTC then has the right to match the highest bid for the management of the toll road.

At stake were the rights, interest and obligations in the management, operation and maintenance of the four-lane divided expressway that passes through the provinces of Bataan, Pampanga and Tarlac, and which is directly linked to the North Luzon Expressway. The contract will be in the form of a business and operating agreement (BOA) that will cover a period of 28 years, or until 2043.

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Creating sanctuary with auspicious design

THE SIGNATURE’S centerpiece is the water features that not only contribute to a resort-like ambience but also enhance flow of money and career of the residents.

When Filinvest Premiere presented The Signature to the media Thursday, the company invited as guest feng shui master Hanz Cua, who explained why living in this medium-rise residential enclave will be a positively balanced experience, nurturing family relationships while forming and strengthening business and community ties.

“Thanks to feng shui, the ancient Chinese system of balancing energy to create a healthy and prosperous space, elements of such have been incorporated into this 6,000-square-meter development to beautify it and to encourage positive and lucky energy—a bonus for those looking for a chic condo on A. Bonifacio Avenue (near Scout Emilio Rivera street), Quezon City,” said Cua.

The Signature will feature three towers with a total of 348 units, ranging from two- (price starts at P9 million) to three-bedroom (price starts at P14 million) units with sizes between 75 and 105 square meters.

Cua explained: “The Signature gives a nod to Chinese heritage by incorporating elements of feng shui into common spaces (in fact, the whole green space is patterned after the Summer Palace in Beijing). The water features at The Signature—the Olympic-size lap pool, submerged and kiddie pools, and lounge and pool decks in each tower—not only contribute to a resort-like ambience but also enhance flow of money and career of the residents. Taichi gardens and oriental courtyards imbue the space with the air of serenity, a significant contrast to the lively and busy highway fronting the property.”

According to Cua, future residents of The Signature would be able to take advantage of the so-called Period 8 that starts on Feb. 4, 2004, and will end in 2023. He said: “Land and prices of properties will increase in Period 8 because earth energy is very important. Properties will be the major investment of families and most likely be the best form of money-making opportunity.”

THROUGHOUT the property, there will be “Pi Yao,” symbols that are regarded as a wealth magnet and is helpful for those who are in need of money luck.

As for the units and its owners, he said wearing green, painting the rooms in shades of green, or using green color elements would enhance money and wealth luck, especially in the year 2015.

When asked why feng shui is a big thing in real estate, Filinvest Land Niche Market Management group head Marjorie Siao explained that feng shui penetrates every aspect of property development.

Siao said: “It is used in site selection, landscape planning, architecture and interior design. In real estate marketing, feng shui is used as a selling point for both residential and commercial developments. For instance, there is positive ‘qi’ when roads go straight by the property and bring energy from both directions, just like A. Bonifacio Avenue. Indeed, the truism in real estate about ‘location, location, location’ holds true with feng shui’s emphasis on site selection and land planning.”

Disclaimer: The comments uploaded on this site do not necessarily represent or reflect the views of management and owner of INQUIRER.net. We reserve the right to exclude comments that we deem to be inconsistent with our editorial standards.

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Danish furniture icon brand opens first store in PH

IMPRESSIVE showroom of Republic of Fritz Hansen in Studio Di mensione

With several international furniture shops opening in the country, there are now more design options to choose from when furnishing a home or residential property. Without having to travel abroad, the homeowner could view the furniture pieces and even choose fabrics and wood finishes to suit their home perfectly.

Studio Dimensione is the furniture shop under the Bench Corp. that brings world-renowned furnishing brands into the local retail market. The newest edition is Republic of Fritz Hansen, the Danish furniture icon brand.

The Republic of Fritz Hansen (www.fritzhansen.com or contact no. 7363728) opened its first store in the Philippines just last week at Studio Dimensione, G/F One Parkade 28th Street corner 7th Avenue, BGC. The first-ever flagship store offers luxury pieces, both classics and newer designs, from this iconic Danish brand. Partnering with Studio Dimensione, the company showcases the cutting-edge, contemporary-style and high-quality craftsmanship that has dominated the Danish design scene for decades.

CONTEMPORARY furniture of Fritz Hansen

For the launch, Dario Reicherl, VP for Asia Pacific, flew in as the Fritz Hansen representative. He spoke about interesting facts about the brand and its iconic products. It was a showcase of the craftsmanship and design philosophy behind the brand.

Renowned architects, designers, furniture aficionados and members of the press witnessed the event as host Daphne Oseña-Paez presented the iconic designs like Arne Jacobsen’s Egg Chair, Swan Chair and Drop Chair. At the end of the successful opening, Studio Dimensione gave away a Drop chair—one of the lost icons now being reproduced again.

Last year, Fritz Hansen launched a new dining table designed by the acclaimed Spanish designer Jaime Hayon. In addition, the iconic Drop chair by Arne Jacobsen was relaunched. This original design was made for the SAS Royal Hotel in Copenhagen in 1958.

More than any other designer, Arne Jacobsen pioneered the concept of Nordic simplicity. And his stackable Series 7 chair earned the team a prominent place in design history. In 2015, the Series 7 chair celebrates its sixtieth anniversary. To mark the occasion, Fritz Hansen is making two special editions of the chair only available this year. The masculine edition is a dark blue lacquer shell and powder-coated burnished legs. The feminine edition is dressed in pale pink lacquer with 24-carat gold-plated legs. Strong together or apart, the chairs highlight and complement each other’s significance.

The Series 7 chair is by far the most sold chair in the history of Fritz Hansen and perhaps also in furniture history. The pressure molded veneer chair is a further development of the classic Ant chair. The four-legged stackable chair represents the culmination of the lamination technique. The visionary Arne Jacobsen exploited the possibilities of lamination to perfection resulting in a durable chair with a perfect shape—that still is as current as ever. In the process of producing the Series 7 chair, everything is carefully scrutinized, with as many as 22 hands checking the quality of our chairs before they leave our factory. Including the highly trained expert who hand picks the veneer from the batch, the specialist chooses which piece will form a coherent sheet of veneer—or not. The result is incomparable perfection seen in the natural flow in the grains of the wood. It’s all about expertise, an uncompromising commitment to quality and a passion for the materials that make each piece so unique.

Today, Fritz Hansen is continually focusing on its overseas markets and growing activities in key Western European markets according to Jacob Holm, CEO of Fritz Hansen. With the growing interest in design, quality, craftsmanship and durability, consumers will pay for products that not only meet a functional need but also add real value to the home or office.

Visit the Republic of Fritz Hansen showroom at Studio Dimensione and experience Danish design at its finest.

Disclaimer: The comments uploaded on this site do not necessarily represent or reflect the views of management and owner of INQUIRER.net. We reserve the right to exclude comments that we deem to be inconsistent with our editorial standards.

To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.

Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:

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Monetary officials guard against steep rise in fuel prices

THE CENTRAL bank has its guard up against a possible recovery in the price of oil, which may shoot up as fast, if not faster, than it has collapsed in the past six months.

Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco Jr. said fuel, if it were to remain cheap, would keep overall average consumer prices stable and fall within the official target of 2 to 4 percent. This will allow monetary authorities to keep benchmark interest rates near record lows.

“But prices can reverse, and often very quickly. Markets tend to get ahead of themselves,” Tetangco said on Friday.

Speaking at Security Bank’s Economic Forum in Makati, Tetangco said the crash in fuel prices, while positive for importers like the Philippines, led to heightened uncertainty in markets and forced policymakers to return to the drawing board.

This comes ahead of the BSP Monetary Board’s next policy stance meeting, scheduled for the second week of February.

Since the fourth quarter of last year, fuel prices have been halved as a result of the Organization of the Petroleum Exporting Countries (Opec) decision to maintain production levels despite a supply surplus.

Prior to the crash in fuel prices, Tetangco said several external developments seemed like forgone conclusions. For instance, the US Federal Reserve was widely expected to hike interest rates by the middle of next year.

Today, the US Fed’s next move seems less certain.

Tetangco said growth in oil exporting countries could also slow this year. Cheaper fuel also brings the threat of deflation, or a decline in average consumer prices, to economies in Europe and Japan, which may warrant more accommodative policy measures.

For the Philippines, Tetangco said, cheaper fuel means people can spend more on other items, boosting consumer demand for a wider range of goods. Production costs for businesses may also fall. About a tenth of the national inflation basket is made up of fuel and fuel-related products.

“We continue to watch developments in the market carefully, and how this affects us to see if there’s a need to make adjustments,” Tetangco said.

Disclaimer: The comments uploaded on this site do not necessarily represent or reflect the views of management and owner of INQUIRER.net. We reserve the right to exclude comments that we deem to be inconsistent with our editorial standards.

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Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:

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Striving to spend more time with cardiac patients

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For Dr. Adolfo Bellosillo, president and founder of the Foundation for Lay Education on Heart Diseases (FLEHD), doctors should spend a significant percentage of their time talking to and examining each of their patients. If it could be helped, they should even talk to their family members.

He said: “There is just no substitute for time in doctor-patient relationships. While efficiency is important, it is not the end of the story. From recorded notes and scribbles taken, doctors would clue themselves in to a lot of information—about the severity of a patient’s condition, change in the patient’s behavior, about recent family tragedies and so on.”

According to Bellosillo, spending more time with their patients will not only improve patient satisfaction and outcomes as inappropriate prescribing or poor clinical decisions based on the wrong prognosis may also be prevented if not minimized.

He said: “Doctors now have too little time and too many patients as well as too much focus on the lab results and too little on the patient. Because observation of heart diseases and their myriad manifestations is critical to building a doctors’ clinical skills, some worry that today’s doctors no longer have had enough interactions with patients to be able to recognize the more subtle signs and symptoms of heart disease or of impending emergencies.”

To address this concern, FLEHD several years ago started sponsoring free series of lectures on preventive cardiology for doctors. Now on its 15th edition, this year’s convention adopted the theme “Preventing cardiac catastrophe through better understanding of cardiovascular pathophysiology.” The convention happened last Thursday and Friday at the Tower 2 auditorium of the Makati Medical Center.

Two issues

Bellosillo explained: “This year’s theme zeroed in on two issues: the heart’s pathology and physiology, two basic subjects taught during the early part of one’s medical schooling. The former deals with the study of diseases affecting the heart and blood vessels while the latter deals with the workings of the heart and blood vessels. Given a particular cardiovascular disease, a thorough knowledge of the workings of the heart and vascular system would help a doctor comprehend what functional changes may be observed in the organs and tissues involved. Likewise, if faced with certain changes in functions of the heart or vascular system, a doctor may be able to know what sort of ailment may be expected.”

This is why the two-day convention also addressed special issues that include if the choice of antihigh-blood medicine is a guessing game, the need for hemodynamic (physical factors that govern blood flow) monitoring in patients suffering from low-blood pressure/shock, and nuances and pitfalls in electrocardiographic (ECG) interpretation. These talks were presided over by FLEHD faculty members, who include Bellosillo, Doctors Mariano Lopez, Enrique del Fuerte and Michael Rome.

Presentations

Just like any FLEHD event, the 15th national annual convention on preventive cardiology for physicians has also included presentations from the University of the Philippines Concert Chorus (under the baton of Prof. Jai Sabas with Prof. Augusto Espino at the piano). For the first time, participants were able to enjoy the Filipino version of the “How to Retain Young at Heart” musical presentation.

Bellosillo said: “With heart disease among the most widespread and costly health problems facing the nation today, cardiologists must be able to practice more efficiently, [so that] he or she will be able to deliver care to more patients. Thus, one important component of our effort is to assure patients that our cardiologists are continuously updating themselves and even taking refresher courses that would enable them to go back to the basics of common cardiovascular diseases and problems, understanding the structures and functions of the heart and major blood vessels, and the development of specific pathology and their clinical manifestations and presentations.”

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COPD: Extinguishing the flames of this preventable disease

When our King of Comedy died from chronic obstructive pulmonary diseases or COPD, it was no laughing matter. This disease had not received as much limelight as heart attacks as the deaths that result from them are not as sudden and dramatic. It is important to note however that it is the third leading cause of death worldwide.

COPD results from the exposure of the lungs and the air passages to harmful stimuli, most notably smoking, resulting in damage that may have limited reversibility. The airways passages narrow and the lungs remain inflated, resulting in difficulties in exhaling the air from inside the lungs. This increases the work of breathing resulting in shortness of breath.

Early on, COPD may be asymptomatic and our only clue may be a history of smoking or, in some cases, cooking using firewood. It is unfortunate that once a patient has symptoms, this usually means that the disease is moderately advanced. Furthermore, as the disease occurs after the age of 40, the shortness of breath is attributed to aging and the cough to smoking. It is therefore important to do early testing of lung function, and this is called spirometry. This will be able to detect airway obstruction and determine the severity and its reversibility.

Once a patient has been diagnosed, it is important to prevent a more rapid deterioration in lung function. Key to this is immediate smoking cessation and removal of all toxic exposures. Vaccinations for flu and pneumonia will likewise provide added benefit. As the symptoms are often debilitating enough, they cause deconditioning because of the activity limitation that COPD imposes. Pulmonary rehabilitation programs are available to help patients cope with this and return them to some degree of functionality.

In terms of medications, inhaled medications present the best options as these are deposited directly into the airways and lungs where they are needed and the doses are administered in smaller amounts, thereby minimizing side effects that would be magnified and noticeable if they were administered orally.

Using the international guidelines called GOLD, a patient is classified according to a subtype, depending on his or her lung function, the capacity for physical activity and the number of times the disease has caused an emergency room visit or hospitalization. Based on the classification, the patient may be started on as needed inhalers with short-acting medications that provide rapid relief or maintained on long-acting drugs that provide sustained assistance.

In our country, the association of lung specialists called the Philippine College of Chest Physicians has embarked on a national strategy to combat this very preventable disease. It’s never too late to stop bad habits and start the journey to a better life!

Dr. Patrick Gerard Moral is vice president of the Philippine College of Chest Physicians and head of training committee of the Center for Respiratory Medicine, University of Santo Tomas Hospital. The A to Z of Health Information Advocacy is a joint initiative of a group of medical specialists and supported by AstraZeneca Philippines aimed at raising public awareness on various diseases and providing health information and updates to the healthcare community.

Disclaimer: The comments uploaded on this site do not necessarily represent or reflect the views of management and owner of INQUIRER.net. We reserve the right to exclude comments that we deem to be inconsistent with our editorial standards.

To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.

Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:

c/o Philippine Daily Inquirer Chino Roces Avenue corner Yague and Mascardo Streets, Makati City,Metro Manila, Philippines Or fax nos. +63 2 8974793 to 94

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Why Bond ETF's May Not Be Your Best Choice

One of the greatest things about the world of finance is we have so many different options when it comes to investing. We have stocks, bonds, mutual funds, ETF's, real estate, commodities, metals, currency, the list goes on. But, with all of these different options, it is difficult to navigate through what we should be investing in and what we should leave alone. Each of the different options investors have at their disposal has their own pros and cons.

With that in mind, let's take a look at Bond Exchange Traded Fund's to help determine if they are the best option for you.

Issues with Bond ETF's

First what is a bond ETF? Similar to other ETF's it is a highly liquid asset which investors can trade in and out of daily, hourly, or even by the minute. These funds hold a variety of different "bond's", based on the restrictions the fund manager has set for the ETF. For example the Pimco Total Return Active ETF (BOND) states its own restrictions as following;

"The fund invests under normal circumstances at least 65% of its asset in a diversified portfolio of Fixed Income Instruments of varying maturities, which may be represented by forwards or derivatives such as options, futures contracts, or swap agreements. It invests primarily in investment-grade debt securities, but may invest up to 10% of its total assets in high yield securities ("junk bonds") rated B or higher."

This essentially means the fund manager can buy whatever he/she wants as long as it falls under one of the categories mentioned above. (This is common among ETF's and mutual funds.) But, if you really read what the manager can purchase, in this case it's just not investment grade bonds, but options, derivatives, futures and even 10% of the funds' assets can be in "junk bonds"; all investments which most would consider much riskier than your investment grade bond.

Furthermore, while this particular bond ETF doesn’t have an unreasonably high expense ratio, just 0.56%, (that is what you are paying to own the fund, plus commission to your broker when you trade in and out of it) the fund has an annual holdings turnover of 577%. A 100% turnover would mean all of the assets the fund holds at the start of the year were sold and new ones were purchased before the year ended.

A 577% turnover means all of the holdings were sold and new ones were purchased nearly six times throughout just one year. This matters to investors because short term capital gains taxes are being paid by the fund each time an asset is sold and commissions are paid both when a sale and purchase is made. The ETF investor may not actually see these costs, but they are certainly eating into the funds overall assets (cash on hand) and hurting its performance.

Now, not all bond ETF's are quite this high; the Vanguard Total Bond Market ETF (BND) has annual holdings turnover of 73%, carries an annual expense ratio of just 0.08%, and attempts to mimic the performance of the Barclays U.S. Aggregate Float Adjusted Index, (which is a bond index).

On the performance front, both ETF's mentioned above are up about 3.5% over the past year, and the Pimco ETF has 4.12% yield while the Vanguard ETF carries 2.5% yield. Not mind blowing performance, but remember these are bond funds.

But there is one more big issue to worry about. When bonds are being traded on the open market they are valued based on what their individual yield is and what brand new bonds are yielding. Currently we are in a very low interest rate-yield environment. When rates begin to move higher and new bonds begin to yield more, the older bonds will trade for less on the open market,(because who wants a bond yielding 3% when you can have one yielding 5%) which in turn will hurt the value of bond funds. Furthermore, when interest rates begin to rise it is likely that even fund's that have had low turnover in the past will see much higher turnover as the managers search for higher yielding investments.

Benefits of Bond ETF's

So what's the benefit of a bond ETF? In the short-term, the ETF is a safe place to park a little cash while you wait for better opportunities in the future. The ease of getting into and out of the ETF is great. Also, safety of bonds in the short term combined with the layering effect, since the ETF owns a number of bonds, is ideal for someone looking to preserve capital. Lastly, the decent yield is in most cases at least the same if not better than what other investments will be paying.

Overall Conclusion

Holding a bond ETF for a long period of time will only cost you money through fees and the fund itself using capital when it constantly is buying and selling. Furthermore, even if you do your due diligence the bond fund may being trading assets that are much riskier than that of what you are comfortable with owning.

If you are a long-term investor, looking to preserve capital through owning bonds, your best bet will be simply buy bonds directly and hold them until maturity. Find a blue-chip company offering a bond with a reasonable yield and for a reasonable time period; buy the bond and be content.

Matt Thalman

INO.com Contributor - ETFs

Disclosure: This contributor has no positions in any stocks mentioned in this article at the time it was published. This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.

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