defending celso

i’m not going to pretend i understand what’s really going on with celso de los angeles and the banking establishment.  my kneejerk response when i read that his rural banks had a ponzi-like scheme going, promising high returns to depositors, higher than that offered by the big banks, i was disgusted, lalo na’t it seemed that he was counting on the pdic to bail out his depositors just in case…

and then i read manila times columnist dan mariano‘s vilification of celso de los angeles, and it made me think again. in the wake of the u.s. economy’s crash thanks to innovative financial schemes, it’s hard to think positive of celso’s own innovations, especially because he has been painted as an incorrigible scoundrel by the mass media.

but if it’s true that big banks could actually match the interest rates he offered on savers’ deposits but big banks just won’t because it would eat into their huge profits, then talaga, it’s possible that celso is the victim of a vilification campaign that was meant to panic his depositors, thus to protect the interests of big banks rather than the interests of the banking public.

makes me wonder about the senate and house investigations.  sino ba talagang pinoprotektahan nila?  makes me wonder too about vice-president noli de castro’s deafening silence.  anyway here’s dan mariano’s column in full:

Vilification of Celso de los Angeles

If you are convinced that Celso de los Angeles is as guilty as sin, read no further.

Off the bat, let me say he is a former classmate of mine. I still regard him as a friend even if these past couple of weeks he has not replied to my calls, text messages and e-mail. Given the pressure he is under, I don’t fault him at all.

As Celso’s friend, I am ready to give him, if not sympathy, then certainly the benefit of the doubt. I am still so prepared-even in the current lynch-mob atmosphere created by certain central bank officials and other quarters.

Not too long ago, Celsotold some of his friends he was anxious about a plot to shut down his businesses. The rural banks he set up, for instance, were offering depositors interest rates on their savings that the big banks could not-or simply refused to-match lest it cut into their profit margins.

As a result, the number of depositors in Celso’s banks, which were spread out across the archipelago, grew at such a rate that the big banks began to feel genuinely threatened.

Serves the big banks right, I thought. Their interest rates were so tiny they did not even allow their depositors’ savings to keep pace with inflation. Keeping your money in one of those big banks was only a bit better than stuffing cash into your mattress, but it still was a losing proposition for the average depositors. I had thought that the aggressive marketing tack taken by Celso’s banks would ultimately stir the big banks into giving their customers a similar or an even better deal. I had hoped the big banks would finally wake up and realize that they now face a serious competitor.

Boy, was I wrong.

Instead of stimulating the big banks’ competitive instincts, Celso’s rural banks-along with his “preneed” ventures, which formed an integrated business-became the object of what amounts to corporate murder. The big banks decided to deal with the competition the only way they knew how-elimination at all costs.

For months, articles and columns were caused to be printed in newspapers and aired on radio and TV questioning the “unsound practices” of the rural banks identified with De los Angeles. Predictably, politicians saw a chance to draw free publicity to themselves and grabbed it.

In what seemed like the blink of any eye Celso had become one of the most vilified men in the Philippines.

Even before the hatchet job was completed, enough of the rural banks’ customers had been so unnerved that they understandably withdrew their money.

Result: A bank run triggered, not by the lack of assets or fraudulent business practices, but by negative publicity and intimidation by officials-far too many of whom look forward to a cushy sinecure in conglomerates that own big banks after retirement.

But was there anything intrinsically illegal in how Celso’s banks and preneed companies operated?

For an answer let me quote excerpts from a column written by Dean de la Paz in the Busi-nessMirror. Last Friday, de la Paz wrote in part:

“Despite the absence of an elementary preneed code, regulators and Monday-morning quarterbacking politicians cry illegality. Because there are no laws, to declare criminality requires some amount of creativity for the charges to stick if fraud and malice are to complement illegality.

“Let us examine a hypothetical preneed offering and see whether those are present.

“Matching revenues against costs is critical in the preneed industry. Where revenue sources and fund providers are one, through a virtual holdout feature, risks of defaults are mitigated, collections more efficient and the matching of revenues to costs closer. Note that here we have a preneed subscriber as clients of either a credit-card company or borrowers in affiliated banks.

“By enhancing this financial model, either through a compounding mechanism on the invested fund where interest earned is compounded monthly, quarterly or even semiannually, a doubling of earnings can be achieved.

“For instance, a credit-card holder paying an effective annual interest of 36 percent, or 3 percent monthly, quickly covers a holdout on the same individual whose funds provided costs a nominal 12 percent annually. By tying an investment that earns 12 percent annually to a debt, or a revenue source that earns 36 percent within the same period, a financial institution can earn 300 percent over the same base. Depending on the compounding schedule-doubling can occur in less than five years.

“In the preneed industry, a hypothetical educational plan can be offered featuring a front-end 20-percent rebate. With warrants that allow repurchases where credit-card companies buy the plan via postdated checks [PDCs], a double-your-money instrument can be offered.

“Should the plan holder liquidate prior to maturity, the 20-percent front-end rebate and the PDC repayments that double the plan’s initial value count as the cost of the investment. Matched against the credit-card company’s 36-percent-per-annum revenue, the cost of the assignable preneed plan can adequately be covered under normal circumstances.

“When offered as a contiguous package, is this patently illegal? Was fraud the intent? Are these designed to steal from plan holders? Or were they meant to offer yields matched against specific revenues?”

Some commentators bewail the fact that the deposit insurance cover for the customers of Celso de los Angeles’s rural banks will cost taxpayers some P14 billion.

Yet some of the same pundits remain mum on, say, the billions of pesos in kickbacks from World Bank projects that were reportedly cornered by a close relative of a high-ranking government official.

Now, why is that?

so long, gloria? 2

that unscheduled, and failed, trip to washington tells me how desperate gloria is for a one-on-one with the u.s. president.   i suspect she was all set to request that obama order the world bank to back off, cease and desist from, releasing any more information re corrupt practices related to infrastructure projects of her government, especially the report that points to hubby mike arroyo’s involvement.

in return kaya for what?  what was gloria prepared to offer that president obama might not have been able to resist?  maybe the acquittal of rapist corporal daniel smith?  maybe charter change and the lifting of economic restrictions?  maybe charter change and federalism and the signing of the moa-a.d.?  maybe charter change and the return of u.s.military bases?

suddenly i’m beginning to think that there’s more to the rumor that the u.s. wants gloria out and noli in, sooner than later, the better to foil an erap return, and that the world bank report is a big part of the effort to discredit the arroyos and agitate the people.  after all, it is the u.s. that is the power behind the world bank.  writes george monbiot in The Age of Consent – A Manifesto for a New World Order, 2003, page 16:

The World Bank and the International Monetary Fund, which are supposed to assist impoverished nations to build and defend their economies, are run on the principle of one dollar, one vote. To pass a substantial resolution or to amend the way they operate requires an eighty-five per cent majority. The United States alone, which possesses more than fifteen per cent of the stock in both organizations, can block a resolution supported by every other member state. This means, in practice, that these two bodies will pursue only those policies in the developing world which are of benefit to the economy of the United States and the interest of financial speculators, even when these conflict directly with the needs of the poor.

besides, it’s not like the world bank to be so high-profile rather than behind-the-scenes in its dealings with government agencies.  maybe the u.s. has finally given up on the recalcitrant arroyos?  maybe they’ve already made a deal with vice president noli de castro?

but if so, the u.s. must be rethinking its options now that noli de castro has been tainted by the legacy scandal.   as it turns out, legacy owner and operator celso de los angeles financed pala noli’s 2004 vice-presidential campaign and noli returned the favor in no uncertain terms.  writes ducky paredes in malaya:

Can Vice President Noli de Castro’s friends in the Senate (where he was part of an influential group of senators before the 204 elections) keep his name out of the Legacy scandal? He has clear ties to Sto. Domingo, Albay Mayor Celso de los Angeles, the owner and operator of the bankrupt Legacy Group of Companies.

Hundreds of thousands of Filipinos lost hard-earned money in Legacy’s fraudulent investment firm and rural banks. Can they actually forgive Noli de Castro’s role in their worst-ever experience? These people lost their life savings to someone who campaigned for Noli and was rewarded with a high post in Noli’s housing programs.

Of course, the Vice President is now distancing himself from De los Angeles after the latter’s grilling by the Senate for the questionable operations of the Legacy group and his companies’ investigation by the Bangko Sentral ng Pilipinas (BSP) and the Securities and Exchange Commission.

But no matter how De Castro disowns Delos Angeles, the damage to his squeaky-clean image has been done.

Noli De Castro admits that Delos Angeles financed his 2004 vice presidential campaign, caused the printing of his campaign materials, and even bought a tabloid to help sell him to voters.

So, immediately after De Castro assumed the vice presidency, he promptly endorsed De los Angeles as head of the National Home Mortgage Finance Corporation (NHMFC).

By paying a political debt to De los Angeles, De Castro not only epitomized everything despicable about traditional politics. De Castro also helped De los Angeles lure more unsuspecting investors and depositors into putting their money in Legacy.

How does the Vice President connect to the Legacy mess by his acceptance of the 2004 election funding from Delos Angeles and his endorsement of the businessman to NHMFC?

Simple. When De Castro endorsed De los Angeles, he vouched for the latter’s integrity, leading people to conclude that De los Angeles and his Legacy Group must be clean for having been given a seal of approval by De Castro, no matter how indirectly.

In fact, although Noli had no qualms dropping De los Angeles like a hot potato, it may not have been because of complaints to Gloria Arroyo that Celso was the worst thing to happen to her housing program, we hear that the two friends had already reached a state of enmity over a pretty young thing. Of course, the TV talent chose the more powerful of the two (and refused to return the jewelry that the other gave her as gifts).

How ironic that they were both working in the Pag-ibig program. Ang pag-ibig nga naman!

With the discovery of the dubious operations of the Legacy Group, shouldn’t the Senate do what it should have done a long time ago – investigate De los Angeles’ stint as head of NHMFC to uncover possible anomalies? In fact, isn’t it about time that they take a hard look at their former colleague’s work at Pag-Ibig and the Housing and Urban Development Coordinating Council?

Are they afraid that they may find that the foundation of our Housing Program is infested with termites like Celso and other Noli friends?

and then, again, what if mababaw (sort of) ang kaligayahan ng mga kano?  what if their attitude is, anyone but gloria?  what if, as jeg suggests, the u.s. has the goods on noli, too, and whatever gloria offers, noli promises, too?

well, at least it will be interesting to watch, whatever happens, or doesn’t happen.

korek si gary, mali ang gma

in gary granada’s place, magagalit din ako, at hindi lang sa gma kapuso foundation, kundi pati sa “composer” na “lumikha” ng piyesang inaprub.  on both counts, the lyrics and the musical structure, gary deserves credit and compensation.

oo nga’t hindi si gary ang sumulat ng original lyrics.  pero in-edit niya ito to fit the melody that he was hearing in his mind, which makes the edited version gary’s version.

oo nga rin at naiba ang melody at dating ng naaprub na version, pero medyo lang, kaunti lang ang pagkakaiba.  korek si gary, obviously nakatungtong ito sa komposisyon niya.  why else does it fit neatly precisely perfectly into gary’s minus-one?  indeed the chance of another composer coming up, out of the blue, with the same melodic structure, bars and chords, as gary’s is one in many millions.

kung totoong hindi natipuhan ng gma kapuso ang komposisyon ni gary, okay lang, it happens.  i’m sure gary was disappointed but i’m also sure that he didn’t feel it was a total waste of time — he could easily come up with his own lyrics, develop the study into a love song, maybe, or a tibak song.   pero dahil ginamit na ng gma7 ang musical structure na iyon, papaano pa niya pakikinabangan?  baka kung gamitin niya ay siya pa mismo ang mapagbintangangang pirata.  hassle.

unethical ang ginawa ng gma kapuso foundation, which sits on the board of filscap that’s supposed to protect the rights of composers and lyricists.  since binitawan nila si gary, dapat ay binitiwan din nila completely ang komposisyon ni gary.  dapat ay original lyrics ang ibinigay sa bagong composer at hinayaan siyang lumikha ng sariling melodic structure without any influence from gary’s work.

unethical din ang ginawa ng bagong “composer”.  inalam kaya niya kung kanino ang original music?  okay lang sa kanya na pagsamantalahan at pakialaman ang komposisyon ng may komposisyon?  member din kaya siya ng filscap?  if yes, yes, yes, it doesn’t reflect well on his integrity as an artist, kung sino man siya.

marck, edel, benignO

over @ the collective filipino voices, young blogger marck ronald rimorin laments:

When are people going to write for the poor, the downtrodden, the laid-off, the fired, the underpaid, the hungry, the sick, the ill… those people who are as sickened about everything as we are, yet don’t have the benefit of blogs or computers to do what they can of it, no matter how small?

radical u.p. intellectual edel garcellano, “sir” edel to many generations of comparative lit students, has this comment on bloggers post-bambi that might explain why it aint gonna happen, marck.

The ANC journalists find blogging the most competitive for mainstream media. Now anyone can infiltrate the public sphere when once in the pre-cyber years only the favored & the ideologically acceptable icons could smugly perorate.

Bloggers of varied IQ & credentials can deliver their daily spiel in cyberspace. Let a hundred flowers bloom? There are, of course, the attendant risks of libel & other judicial threats in a feudal environment, but the current scenario simply exemplifies that the huge energy of counter-discourse is being tapped to mount an offensive against the canonical satraps of state apparati.

This is what the valley golf brawl has uncovered: the rise of cyber critics, who responsible or not, middling or talented, tilt the balance in favor of the unarticulated response, the publicly repressed, the individually marginalized. The personal-& the quotidian, the everyday-has assumed the political: & militarist mentors are hard put to clamp the irreverent folks in jail, much less stem the textual avalanche. In the techno-terrain, words transform, mutilate.

Of course, bloggers must necessarily be middle-class, professional. No informal settlers would figure in the equation, even if OFWs infest their fold. The discourse therefore is basically extension/amplification of capitalist production, some internal resistance that however falls within the ambit of reformist negotiation. The very idea therefore of a radical dialogue isfar-fetched.

It might even cultivate the impression that freedomflourishes in a fascist state. For which a Maoist revolution is old hat, impractical, naïve, discredited.

yes, the discourse is reformist rather than radical.  most if not all bloggers are middle-class and the middle-class is, at best, reformist — we want changes, an end to corruption (which we think will solve poverty) but nothing too drastic, nothing that would rock the boat or upset the status quo.  in contrast, “radical” is associated (and outlawed) with the communist left and means drastic deep-seated changes in the way wealth and resources are distributed and how we do business with each other as a people.  the kind of discourse that threatens and shakes the status quo, indeed the kind of discourse (in filipino) that can be found elsewhere in the blogosphere, but not in sosyal fv.

HOWEVER, fv is not entirely without substance.  i hate to disagree with practically everyone who has ever dissed and continues to diss marck’s co-blogger benignO.  i’ve just been to his blog getrealphilippines — i visited once long ago to check out his ebook but was turned off, i don’t remember why now, senior moment ;) — the book’s gone, in its place a brief analysis of and solutions to the poverty and backwardness of the filipino that is the best stuff i’ve read so far on the subject from a filipino (okay, filipino-australian), who is obviously influenced by third wave thinkers and informed by the filipino experience, and whose context of solutions is actually another way of redistributing the wealth and doing business with each other as a people.  his current post substance matters in an economic crisis is also worth cross-posting @fv.

Decades of dependence on foreign employment (and a lack of appreciation of its social costs), sustained prostitution of the economy at the altar of the gods of “foreign direct investment”, and a consumer market opened to a flood of non-durable imports has rendered Philippine society one that utterly lacks substance — one that could now be providing a safety net for workers once hailed as “heroes” of the Republic now returning to become its burden.

it’s a pity that rather than flesh out, test, develop further his ideas @  fv — the perfect venue, i’d say — mostly benigno heckles and baits and asks hard questions, the latest of which is:  what does “the filipino” stand for?

Even as we struggle with the low bar of defining an identity, the aim for a stand – the higher bar – I realise seems a virtual impossibility for a people such as ours based on what I’ve seen so far.

What does the “Filipino” stand for?

The question remains unanswered; not that it ever will be convincingly.

Then again isn’t conquest of perceived impossibility the very essence of achievement? Maybe not so if you are a Filipino. And that kind of regard for achievement is probably what defines us.

what does “the filipino” stand for?  right now “the filipino” (collective, as opposed to the individual) does not stand for anything, much like fv, which does not stand for any one thing that the group as a whole can agree on — if there is, it has yet to be articulated.  in the case of the nation, the possibility of standing for something, the capacity to stand for something, has yet to be grasped, thanks to mainstream media that continue to fail the people.