APEC Meeting, Terror in Paris, Syrian Refugees
and Madoff’s Ponzi Scheme Payouts
By Eliseo "Jojo" Prisno, CRPC, MS
Chartered Retirement Planning Counselor
PE CAPITAL INVESTMENTS
Happy Holidays to readers of Pinoy’s Money Matters. 2015 was for sure a wild ride for the investing public. We saw how oil prices dropped from a peak of $114 per barrel to a low of $40 and how it dumped stock prices of the energy sector. We also witnessed the Greek drama that riddled the market with wild volatility, the China economic slowdown confirmation which eventually led to currency wars and devaluations (and if you still are unaware, strengthened the US dollar in terms of exchange). The currency value readjustments led the Russian Rubble to lose 20% of its value, the Philippine Peso US Dollar exchange from 43 to 47 and our northern neighbor Canada (which officially declared its economy in recession) reversing their Dollar. We actually traveled to Toronto last October and I was quite surprised on the exchange rate, my 100 USD was valued at 128 Canadian, a total opposite when we did our Transpacific Highway drive in 2014 (from Vancouver to the East) when 100 USD was merely valued at 97 Canadian (as of this writing it's already pegged at 133 per 100 USD). In a span of 12 months, we saw a 40% reversal in value, or maybe you only noticed while reading this article.
If you are aware of news headlines, the title of this year-end editorial (as of its writing) is what dominates, or maybe not the last one unless you’re one of those “Ponzi” scheme victims that diligently follows the Bernie Madoff drama. Yes dear investors, a Manhattan judge authorized Irving Picard, the trustee liquidating the Madoff investments to release $1.42 Billion in payouts to Madoff investors. Finally after 6 years, the biggest financial fraud in the financial history is being corrected. $1.42 Billion may not be enough to cover the massive losses but it’s a start and hopefully this development will reestablish confidence for investors who got victimized by investment fraudsters. The big news headline last month was the Paris shootings (more than 130 dead) by Islamic extremists, an event with a stigma comparable to 9/11, the London bus bombings, the Madrid bombings just to name a few over the past decade. Surprisingly, the week following that dreadful weekend in Paris, the market wasn’t dampened of the news, it in fact reversed its course from a bearish stance to a bullish set up. The week delivered almost a 3% market growth (thanks partly to the FED’s interest rate policy certainty that finally they are ready to increase it), to me this is evident of the resilience of the human spirit and our faith in our civilized society. If you remember 2001, the same scenario happened, the investment market was not affected in as far as the valuations were concerned. If anything this is one way in winning the war against these terrorists. These extremist militants’ ultimate goal is to create havoc to our way of life, thinking that their urban terror schemes will eventually scare everyone to function normally and eventually lose trust on our way of life (watching concerts, going to sports events, eating out, and investing in the capital markets). Well, how Wall Street reacted after that dreadful weekend speaks much on how resilient we are as members of the civilized capitalist society.
The only negative sound bites that came out that week was how our US politicians (the GOP candidates to be specific) reacted to the refugee crises in Syria. Yes, ISIS is trying to exploit the humanitarian chaos in the Middle East as a vehicle to enter the western world, but by no means this displaced and disenfranchised people should suffer further by curtailing their migration rights. If I remember correctly, almost 90% of us in the US were migrants at one point in our generation. The best reaction that week on the issue was from the French Prime Minister himself, despite the situation, they did not renege on their promise to accept 30,000 of those displaced Syrians. This is one way to show these terrorists that the western world cannot be bullied, hats off to the French. And finally the APEC meeting back home, yes the Philippines is on lime light hosting the 21 global leaders (including the US) for economic cooperation. Being still Filipino, it makes me proud to showcase our culture and improved society (despite the bullet scams at NAIA). Just in case you missed it, early this year, Bloomberg pronounced the Philippines as the second fastest growing economy in the world (next to China) and 15 years down the road, we will be the 16th biggest economy.
Point is, whatever the headlines and the shenanigans we encounter every day, investing will be part of our way of life and the backbone of our society. And despite some setbacks, we try to correct and improve the scenario, this is how resilient our society is. Again HAPPY HOLIDAYS and all the best for 2016.
ABOUT THE WRITER: Eliseo Jojo Prisno is a Chartered Retirement Planning Counselor (CRPC).He founded P/E Capital Investments in 2010, a State Registered Investment Advisory Firm (CRD# 172695) and is currently the firm’s Managing Director and Senior Investment Advisor. Mr. Prisno also manages a Fund of Funds investment program with Ameritas and runs an All-Equity Growth and Income customized portfolios in separate accounts via E*Trade Securities. If you have questions email j.prisno@PEcapitalinvestments.com or call 1-888-929-2825. Visit our website www.PEcapitalinvestments.com