GRADUATING FROM THE UNDERGROUND ECONOMY
NO HOLDS BARRED (018) June 14, 2009
By Ike Señeres
GRADUATING FROM THE UNDERGROUND ECONOMY
Many Filipinos are in business, but they could hardly be called businessmen in the real sense. Many of them have no access to formal credit, and because of that, they become victims of loan sharks, some of them being caught in that trap for several generations. This is a sad reality in a country where no one can go to jail for usury, because it is no longer illegal here.
Although they are hard working, they are hardly able to make ends meet, because interest costs are too high, and they are unable to make more sales by increasing their inventories. This is also the sad reality among farmers, who work very hard all their lives, but who are practically just working for the middle men who eat their profits by way of high lending costs.
Working as vendors or farmers, they are really just working to survive the days that pass, but they could not look forward to a brighter future since they are not building something that they could own in the long term, and perhaps bequeath to their children. If only they could gain access to formal credit, they would perhaps be able to build companies that would not only beef up their own household economy, but would also strengthen the national economy as well.
Looking back in history, it was actually the small farmers and shop keepers that built the British economy, laying the groundwork for an industrial economy that came later on. There is a saying that Britain is a nation of shop keepers, and it is that reality that actually made their economy very strong up to now.
Going now into the practical realm, our own shop keepers and farmers could only graduate and build their companies if they register their businesses, if they open bank accounts, if they keep accounting records, if they establish a credit history, if they protect themselves with insurance coverage and if they pay their taxes properly. These are the six requisites that they have to have in order to graduate from the underground economy.
In reality, they could only get access to formal credit if they have a registered business, if they have a bank account for reference, if they could present their financial statements, if they could show their proof of good credit, if they show their insurance coverage, and if they submit their income tax returns.
This column that you are reading is now published by thirty community newspapers nationwide, with three of them distributing worldwide to Filipino communities abroad. More than ever, this column now has the greater potential to become a tool for the development of small business, and I am happy to report about two recent opportunities in relation to this goal.
Two computer experts who are regular guests in my TV show have volunteered their services to small and medium enterprise (SME) owners, in order to help them computerize at the least cost to them. Using old computers and free software, they could now modernize their businesses by automating it. I thank Ben Garcia and Leo Querubin for this.
The other good news is that the Development Academy of the Philippines is now working on a program that would offer training seminars to SME owners who would like to graduate from the underground economy, by teaching them how to bring about the six requisites that I mentioned. This will be done in cooperation with my TV show, and I thank Trygve Bolante for this.
What is the connection between small businesses and the stock market? Despite its many years of existence, the trading volume in our stock market is still relatively small, in relation to the foreign markets around us. Sad to say, less than 1% of our people are investing in the local stock market, compared to Japan where over half of the population do invest.
In the case of Japan, many of the investors are farmers and small business owners. It would be logical to think that as soon as our farmers and small business owners are able to graduate from the underground economy and are also able to grow their own companies, they would be able to invest in the stock market as well. In a related development, I will soon be announcing in my TV show and in this column two breakthrough technologies that will boost the business of our local farmers.
Watch my TV show “Bears & Bulls”, a daily coverage of the Philippine Stock Exchange. 9:00 am to 1:00 pm in Global News Network. Email iseneres@yahoo.com or text +639293605140 for local cable listings.
By Ike Señeres
GRADUATING FROM THE UNDERGROUND ECONOMY
Many Filipinos are in business, but they could hardly be called businessmen in the real sense. Many of them have no access to formal credit, and because of that, they become victims of loan sharks, some of them being caught in that trap for several generations. This is a sad reality in a country where no one can go to jail for usury, because it is no longer illegal here.
Although they are hard working, they are hardly able to make ends meet, because interest costs are too high, and they are unable to make more sales by increasing their inventories. This is also the sad reality among farmers, who work very hard all their lives, but who are practically just working for the middle men who eat their profits by way of high lending costs.
Working as vendors or farmers, they are really just working to survive the days that pass, but they could not look forward to a brighter future since they are not building something that they could own in the long term, and perhaps bequeath to their children. If only they could gain access to formal credit, they would perhaps be able to build companies that would not only beef up their own household economy, but would also strengthen the national economy as well.
Looking back in history, it was actually the small farmers and shop keepers that built the British economy, laying the groundwork for an industrial economy that came later on. There is a saying that Britain is a nation of shop keepers, and it is that reality that actually made their economy very strong up to now.
Going now into the practical realm, our own shop keepers and farmers could only graduate and build their companies if they register their businesses, if they open bank accounts, if they keep accounting records, if they establish a credit history, if they protect themselves with insurance coverage and if they pay their taxes properly. These are the six requisites that they have to have in order to graduate from the underground economy.
In reality, they could only get access to formal credit if they have a registered business, if they have a bank account for reference, if they could present their financial statements, if they could show their proof of good credit, if they show their insurance coverage, and if they submit their income tax returns.
This column that you are reading is now published by thirty community newspapers nationwide, with three of them distributing worldwide to Filipino communities abroad. More than ever, this column now has the greater potential to become a tool for the development of small business, and I am happy to report about two recent opportunities in relation to this goal.
Two computer experts who are regular guests in my TV show have volunteered their services to small and medium enterprise (SME) owners, in order to help them computerize at the least cost to them. Using old computers and free software, they could now modernize their businesses by automating it. I thank Ben Garcia and Leo Querubin for this.
The other good news is that the Development Academy of the Philippines is now working on a program that would offer training seminars to SME owners who would like to graduate from the underground economy, by teaching them how to bring about the six requisites that I mentioned. This will be done in cooperation with my TV show, and I thank Trygve Bolante for this.
What is the connection between small businesses and the stock market? Despite its many years of existence, the trading volume in our stock market is still relatively small, in relation to the foreign markets around us. Sad to say, less than 1% of our people are investing in the local stock market, compared to Japan where over half of the population do invest.
In the case of Japan, many of the investors are farmers and small business owners. It would be logical to think that as soon as our farmers and small business owners are able to graduate from the underground economy and are also able to grow their own companies, they would be able to invest in the stock market as well. In a related development, I will soon be announcing in my TV show and in this column two breakthrough technologies that will boost the business of our local farmers.
Watch my TV show “Bears & Bulls”, a daily coverage of the Philippine Stock Exchange. 9:00 am to 1:00 pm in Global News Network. Email iseneres@yahoo.com or text +639293605140 for local cable listings.
posted by Ike Señeres at 10:24 AM
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